Chip equipment maker Applied Materials said Thursday it’s buying Applied Films for $464 million, a purchase that will enable Applied Materials to enter the growing solar cell market.

Applied Materials, which develops million-dollar machines for chip manufacturing, wants a piece of the fast-growing solar market. Aside from solar cells, Applied Films’ thin-film deposition equipment is used to produce flat panel displays, flexible electronics, and energy-efficient glass.

“The acquisition of Applied Films expands our flat panel business to offer color filter products, and opens the fast-growing solar market for us,” said Mike Splinter, CEO of Applied Materials.

Applied Materials, based in Santa Clara, California, will pay $28.50 for each outstanding share of Applied Films and assume the company’s outstanding stock options. The deal represents a 25 percent premium over Applied Films’ closing price of $22.76 on Wednesday.

Applied Films’ shares jumped 22.03 percent to close at $28.03 per share. Applied Materials’ shares rose 2.71 percent to $18.55 per share.

Thin-film solar cell technology is hot because it promises to be a good alternative to conventional solar cells, which use silicon as one of their main ingredients. In recent years, makers of conventional solar cells have run into silicon shortage. Thin-film solar cells have a size and flexibility that make them suitable for a variety of electronics devices.

Several startup companies such as HelioVolt have developed thin-film coating materials and methods that promise to create better-performing and cheaper solar cells.

Applied Films, which was formed in 1976, created a solar division just two months ago to better focus on the market.

Applied Materials expects to close the deal during its third quarter.