April 21 (Reuters) - Forge Nano, a U.S.-based

semiconductor equipment and advanced materials company, plans to

go public through a $1.6 billion blank-check deal with

Archimedes Tech SPAC Partners II ( ATII ), the companies

announced on Tuesday.

The deal comes amid booming demand for AI chips in recent

years as companies ramp up spending on data centers and

high-performance computing to support generative AI

applications, benefiting chip firms and equipment makers across

the supply chain.

Robust demand has boosted orders for advanced chips and the

tools used to manufacture them, despite lingering worries over

supply constraints and the industry's cyclical nature.

The deal is expected to generate gross proceeds of up to

$342 million, including $242 million held in the special purpose

acquisition company's (SPAC) trust account.

A SPAC is a shell firm that raises capital through an IPO to

merge with a private business, offering a quicker alternative

than a traditional IPO.

SPAC mergers hit record levels in 2020 and 2021, with

several Wall Street heavyweights - including billionaire

investors Bill Ackman and Michael Klein - betting on them as the

next big trend in listings.

However, activity slowed sharply in subsequent years as

regulatory scrutiny increased and investors soured on the

once-popular vehicle.

Forge Nano is backed by several marquee investors, including

Volkswagen, GM Ventures and LG Technology Ventures. It has also

received a $100 million grant from the U.S. Department of

Energy.

Forge Nano said it will use the proceeds to scale U.S.

manufacturing of semiconductor tools and lithium-ion batteries

and support expansion into high-growth markets such as

pharmaceuticals, data centers and quantum computing.

The companies expect the SPAC deal to close in the

second-half of 2026. The combined entity will trade on the

Nasdaq under the ticker symbol 'NANO'.