Wolfspeed Secures $2.5B Investment

By Bobby Samwell • Tuesday, October 15 15:21 • Permanent Link

Wolfspeed, a leader in silicon carbide technology, has announced significant financial developments. The company has secured $750 million from the U.S. Department of Commerce under the Chips and Science Act, with an additional $750 million in financing from an investment group led by Apollo, the Baupost Group, Fidelity Management & Research Company, and the Capital Group. In addition, Wolfspeed expects to receive approximately $1 billion in cash tax refunds from the IRS over the next several years, bringing the total expected capital to $2.5 billion.

These investments will support Wolfspeed's long-term growth plans and domestic production of silicon carbide, a superior alternative to silicon for high-power applications such as electric vehicles, renewable energy systems, and AI data centers. The company plans to use the funding to expand its manufacturing footprint in upstate New York and central North Carolina.

The proposed funds are expected to be received upon milestone achievements in the coming years, enabling Wolfspeed to complete its multi-billion-dollar greenfield U.S. capacity expansion plan, which consists of the largest and most advanced 200mm silicon carbide footprint in the world. This investment will bolster Wolfspeed’s balance sheet and fuel significant growth through cash generation, accelerating its long-term profitability goals.

The company's CEO, Gregg Lowe, emphasized that these investments will enable Wolfspeed to solidify its leadership position and contribute to the resilience and competitiveness of the U.S. supply chain. The importance of bolstering domestic production of silicon carbide has been recognized across multiple federal agencies, with the Department of Energy and the Department of Commerce acknowledging its significance to clean energy technologies and national security.

The press release also includes statements from U.S. Secretary of Commerce Gina Raimondo, Senator Chuck Schumer, and other officials commending Wolfspeed's role in bringing semiconductor manufacturing back to America and creating jobs in various regions.

Today the company's shares have moved 20.3% to a price of $13.69. For the full picture, make sure to review Wolfspeed's 8-K report.

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