Cohu Inc., the Poway company that makes equipment for semiconductor factories, announced on Oct. 1 that it has completed its acquisition of Massachusetts-based Xcerra Corp. for about $800 million. Shareholders of Xcerra exchanged each share of Xcerra for $9 plus 0.2109 share of Cohu stock (which trades on the Nasdaq under the symbol COHU).

Deutsche Bank Securities served as the exclusive financial advisor to Cohu and provided the Poway company with a $350 million secured term loan for the acquisition.

Xcerra (Nasdaq: XCRA) also makes equipment for testing semiconductors and MEMS, or microelectromechanical systems. The acquisition gives Cohu a new core competency: the ability to test printed circuit boards.

Shares of Xcerra closed Oct. 1 at $14.65; Cohu stock closed at $25.20.

Cohu CEO Luis Müller will be CEO of the combined company.

Cohu said it plans to consolidate facilities and projects. It said it expects to achieve $20 million in cost synergies within two years, excluding stock-based compensation and other charges, and another $20 million in synergies in three to five years.

Two members of the Xcerra board — Xcerra CEO David Tacelli and Xcerra director Jorge Titinger — have joined the Cohu board as part of the deal. With the additions, the Cohu board increases to eight members.

“The acquisition of Xcerra accelerates our strategy to diversify our product offerings and customer base, expanding Cohu’s addressable market to approximately $5 billion across semiconductor test and handling equipment, thermal subsystems, test contacting, vision inspection, MEMS and PCB [printed circuit board] test. This combination also further strengthens our ability to fully capitalize on the growth opportunities in our key target markets of automotive, industrial, IoT and communications,” said Müller in a statement issued by the company. IoT stands for the Internet of Things.

“Although softening in the mobility market combined with current geopolitical uncertainty are creating near-term headwinds, we remain confident about the long-term growth opportunities in these markets as well as our ability to deliver on our synergy goals and to profitably grow Cohu in the years ahead,” added Müller.

Cohu said it expects to elaborate on its plans during its third quarter financial results conference call in early November.

Cohu approached Xcerra about an acquisition in February; Xcerra’s board and management announced they had accepted the offer in May. Shareholders of both companies approved the merger on Aug. 30.

Cleary Gottlieb Steen & Hamilton LLP served as Cohu’s legal adviser.