9 February 2017
Cree's sale of Wolfspeed to Infineon unlikely to be approved by CFIUS
LED chip, lamp and lighting fixture maker Cree Inc of Durham, NC, USA has provided an update regarding last July's definitive agreement to sell its Wolfspeed Power and RF division - which includes the silicon carbide (SiC) substrate business for power, RF and gemstone applications - to Infineon Technologies AG of Munich, Germany for $850m in cash (about €740m).
Based in Research Triangle Park, NC, USA and part of Cree for almost three decades, Wolfspeed is a provider of SiC-based power and GaN-on-SiC-based RF power solutions. With more than 550 staff and an IP portfolio of about 2000 patents and patent applications, the acquisition would complement Infineon's previous acquisition of International Rectifier in early 2015. Wolfspeed's SiC-based product portfolio would add to Infineon's existing range.
Now, based on recent communications with the Committee on Foreign Investment in the United States (CFIUS), the parties believe that the transaction in its current form is not likely to be approved by CFIUS. The parties are therefore exploring whether there are alternatives to modify the transaction (in order to mitigate or address the regulatory concerns) which, if agreed by the parties, would involve a refiling with CFIUS.
Cree cautions that there is no assurance that the parties will achieve a transaction structure that would obtain CFIUS clearance. As a result, pending the outcome of these efforts, the likelihood or timing of closing the transaction is uncertain.