Cree Completes Sale of its LED Business to SMART Global Holdings
Mar 5, 2021
Cree, Inc. announced it has completed the previously announced sale of its LED Products business unit to SMART Global Holdings, Inc. effective March 1.
SMART will license and incorporate the Cree LED brand name into the SMART portfolio of businesses.
Cree will change its corporate name to Wolfspeed later this year. Under the transaction terms Cree will receive up to $300 million, which consists of a $50 million cash payment at close and a $125 million seller note to be paid upon maturity in 2023. Cree also has the potential to receive an earn-out payment of up to $125 million based on the revenue and gross profit performance of Cree LED in the first full four quarters post-transaction close, also payable in the form of a three-year seller note.
Cree LED will operate as the Cree LED business unit of SGH and will be led by Claude Demby as Senior Vice President (SVP) and President of Cree LED. Mr. Demby most recently served as SVP and General Manager of Cree LED. He joined Cree in 2014 and has held a number of leadership positions including VP Business Development, VP and GM of the LED Chips and Materials business, and SVP of Corporate Development. He brings more than 25 years of executive leadership experience across the LED, automotive, aerospace and materials technology industries.
“The completed sale of Cree LED represents a major milestone in our transformational journey, establishing the company as a pure-play global semiconductor powerhouse, well positioned to lead the industry transition from silicon to silicon carbide,” said Gregg Lowe, Cree CEO.
“The closing of our acquisition of Cree LED represents an important milestone in our growth and diversification strategy,” said Mark Adams, President & CEO of SMART Global Holdings. “Cree LED’s focus on specialty lighting fits well with our other specialty businesses in computing and memory. Cree LED brings outstanding customer relationships, industry leading technology and product development capabilities, plus expansive R&D expertise and strong IP with more than 2,000 patents.