The tech companies have agreed to merge their businesses to form a new company, and the first major merger between the two would create a major tech giant.
The companies said they would offer their employees stock options and the option to buy the company, which would create more than a million jobs.
Under the deal, the combined companies will be known as Apple Inc, with Apple’s headquarters in Cupertino, Calif.
The new company will be called Alphabet Inc., with its headquarters in Mountain View, Calif., and with its operations in Sunnyvale, Calif..
The deal was announced Wednesday.
The move, announced in a filing with the Securities and Exchange Commission, would create the largest company in the world, and one of the largest publicly traded companies in the United States.
Apple CEO Tim Cook said the deal was the “right thing to do for Apple and for the world.”
“We are extremely proud to be a part of the Apple family,” he said.
“We’ve grown our company into one of our industry’s most valuable assets and a leader in the mobile and web businesses, and this is a very good start to what we will do together.”
Apple has about 10 million employees, most of them outside the U.S., but Apple Inc’s global operations are based in California, with headquarters in Sunnydale, Calif and other areas of the world.
Alphabet Inc is based in Mountainview, Calif, and has its headquarters and offices in the same region.
As part of Wednesday’s announcement, the companies also agreed to “comprehensively implement” the merger, which will create about 1,000 jobs at Apple, and 1,500 at Alphabet, including at its headquarters, and at Apple’s research and development facilities in Silicon Valley, and its manufacturing facilities in Mexico City.
Ahead of the announcement, shares of Apple and Alphabet rose more than 2 percent in premarket trading, after the news was announced.
“Today’s announcement represents the next logical step for the future of our businesses,” said Jeff Bezos, CEO of Amazon.com Inc., the company that owns the Washington Post, in a statement.
“Together, we will accelerate our growth, and create a more productive and diverse company that will deliver on our most ambitious goals.”
The merger comes as Alphabet has been grappling with declining revenues and a number of lawsuits over alleged antitrust violations, including the acquisition of Motorola Mobility by Google Inc. The tech giants had previously announced a plan to split into two companies to compete against each other, but those plans were delayed amid concerns about antitrust concerns.
Apple’s chief executive Tim Cook, left, and chief technology officer Marissa Mayer pose for a portrait during an interview at the company’s headquarters on May 3, 2017 in Cuver City, California.
(Photo: Jim Urquhart, AP)Cook said the companies had “come to a definitive agreement” on the merger and that “there is no risk of competition from any of the companies that will be created.”
“We’re thrilled to join forces with these incredibly smart, talented people who are creating incredible value for our customers, our employees and the world,” Cook said in a written statement.
Apple is expected to announce the merger later this week, according to a person familiar with the matter.