Cree will terminate the agreement to sell its Wolfspeed power and RF business to Infineon Technologies, according to a statement Cree issued on February 16. Cree and Infineon have been unable to identify alternatives to address the national security concerns recently expressed by the Committee on Foreign Investment in the United States (CFIUS). The termination will trigger a termination fee of $12.5 million that Infineon will pay to Cree.
Cree will continue running Wolfspeed and report it as a separate business segment. The business includes power electronics and RF components and silicon carbide wafers, including epitaxial materials for power, RF and gemstone applications.
Chuck Swoboda, chairman and CEO of Cree, said,
"We are disappointed that the Wolfspeed sale to Infineon could not be completed. In light of this development, we are going to shift our focus back to growing the Wolfspeed business.
"The Wolfspeed business has performed well this year as our customers have further realized the value of our unique technology and is on a great path as a part of Cree. The strength of our balance sheet and improving operating cash flow gives us the ability to invest in Wolfspeed, while continuing to pursue our LED and lighting growth plans. We believe investing to grow all three businesses will create the most value for our shareholders.
"I thank Dr. Ploss and the rest of the Infineon team for the significant amount of time and commitment they invested trying to successfully complete the transaction."