Status:  Upcoming/New

Acquirer:  Infineon Technologies AG (Germany)

Acquired:  Cree, Inc. (US)

Value: US$850 million

Industry: Semiconductors

On July 13, 2016, Infineon Technologies AG, a semiconductor manufacturer based in Germany, and Cree, Inc. (Nasdaq: CREE), a US based manufacturer of LED products and semiconductors, executed an asset purchase agreement whereby Infineon will acquire the Wolfspeed Power and RF division (“Wolfspeed”) of Cree and the related silicon carbide (SiC) wafer substrate business for power and RF power. (see Joint Infineon and Cree press release, July 14, 2016).   According to Cree SEC filings, the transaction is conditioned on approval by CFIUS.  (See Cree SEC Form 8-K, July 14, 2016; Cree SEC Form 10Q, October 19).    On October 18, 2016, Cree disclosed that the parties received a second request from the federal trade commission regarding the transaction, but only disclosed that the parties were “continuing to work together to obtain” CFIUS approval.  (See Cree SEC Form 8-K, Ex. 99.1, Oct. 18, 2016.)

The purchase price for this planned all-cash transaction is US$850 million.  The transaction is expected to close by the end of 2016, and is subject to clearance by CFIUS among other regulatory requirements and closing conditions. The acquisition of Cree’s business includes capabilities in semiconductor compounds SiC, gallium nitride on silicon (GaN-on-Si), and gallium nitride on silicon carbide (GaN-on-SiC).  (For the preceding sentences, see Joint Press Release, July 14, 2016; Cree SEC Form 10Q.)    Frank Plastina, CEO of Wolfspeed, issued a statement that the acquisition will give the Wolfspeed business “the advantages of a global company in our sector, including the ability to leverage Infineon’s market reach and infrastructure.” (See Joint Press Release.)   Additional coverage of the transaction can be found in this Forbes, July 15, 2016 article, and Bloomberg’s article dated July 14, 2016.