In February 2017, Cree announced that the sale of Wolfspeed, its power and radio-frequency (RF) electronics division, to Infineon had been terminated. The transaction was initially announced by Infineon last July, with the intention to acquire the power, RF and related SiC wafer substrate business for $850M.
In early February 2017, Infineon and Cree were notified by the Committee on Foreign Investment in the United States (CFIUS) that “the transaction poses a risk to the national security of the United States”. “Furthermore, CFIUS had not identified any mitigation measures that it believed would adequately mitigate the particular national security risks posed by the transaction,” the notification said. Following this notification, the two companies decided to terminate their agreement.
(Source: Power SiC 2016: Materials, Devices, Modules and Applications, Yole Développement, June 2016)
The acquisition, if it had succeeded, was supposed to be a ‘win-win’. Infineon’s post-acquisition SiC power market share would have been more than 50%, as estimated in Yole Développement’s latest compound semiconductor report, Power SiC 2016: Materials, Devices, Modules and Applications. Infineon would have established vertical integration from SiC wafer to power module manufacturing. In addition, the German company would have gained a strategic advantage in the GaN RF business. RF GaN is going to play an important role in the 5G market, as explained in Yole’s report, GaN RF Devices Market: Applications, Players, Technology, and Substrates 2016 - 2022.
The result is disappointment for both Cree and Infineon, but good news for other device players in both the SiC power and GaN RF market. After last July’s announcement, anxiety increased about the future supply of SiC wafers and the dominance of Infineon’s position in the SiC power electronics market and the power electronics market generally. The termination provides more space and opportunity for other power device companies. In the GaN RF market, Infineon still needs to catch up in GaN HEMT development, together with other new comers like NXP, Ampleon...
(Source: GaN RF Devices Market: Applications, Players, Technology, and Substrates 2016 - 2022, Yole Développement, March 2016)
Finally, although this transaction failed, we would not be surprised if other companies try to acquire Wolfspeed in the coming years, considering the strategic position of the company in both SiC power electronics and GaN RF markets.
Power SiC 2016: Materials, Devices, Modules, and Applications
More confident and more prepared, power SiC is progressing at a 2015 - 2021 CAGR of 19%! - More
GaN RF Devices Market: Applications, Players, Technology, and Substrates 2016 - 2022
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