Looking to become even more focused on its light-emitting diode (LED) lighting business, Cree, Inc. is selling its Wolfspeed Power and RF division to Infineon Technologies AG.
Under the $850 million deal, Infineon will acquire the silicon carbide substrate business for power, RF and gemstone applications from Cree, which announced in 2015 its plans to focus more on lighting than other parts of its business.
Before this transaction, Cree planned to roll out Wolfspeed as an independent company and raise capital to fuel an IPO. However, after being approached by several companies interested in acquiring the business, Cree decided to sell it rather than bring it public.
Chuck Swoboda, chairman and CEO of Cree, says divesting Wolfspeed will increase free cash flow while at the same time sharpen Cree’s focus as an LED lighting technology company.
The acquisition is expected to close this year, pending any regulatory approvals, after both boards of directors have approved the deal. Wolfspeed generated pro-forma revenue of $173 million over the last 12 months.
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