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© Cree Business | October 19, 2020

Cree to sell LED Business to SMART Global Holdings

Cree says it has entered into a definitive agreement to sell its LED Products business unit (Cree LED) to SMART Global Holdings for up to USD 300 million.

Under the terms of the agreement, which has been approved by the company’s board of directors, Cree expects to receive an initial cash payment of USD 50 million upon closing and USD 125 million to be paid upon maturity of a seller note issued by SMART to Cree due August 2023. Cree also has the potential to receive an earn-out payment of up to USD 125 million based on the revenue and gross profit performance of Cree LED in the first full four quarters post-transaction close. “We are pleased to announce the sale of our LED Products business to SMART, which represents another key milestone in our transformational journey to create a pure-play global semiconductor powerhouse,” says Cree CEO Gregg Lowe, in a press release. “This transaction uniquely positions us with a sharpened strategic focus to lead the industry transition from silicon to silicon carbide and further strengthens our financial position, which will support continued investments to capitalize on multi-decade growth opportunities across EV, 5G and industrial applications.” SMART is a global player in specialty memory, storage and high-performance computing solutions serving the electronics industry for over 30 years. “We are thrilled to welcome Cree LED to the SMART family,” says Mark Adams, President and CEO of SMART Global Holdings. “As the leader in LED lighting technology with a highly respected brand and expansive patent portfolio, Cree has a track record of delivering best-in-class solutions and I am very excited about the opportunities that lie ahead for Cree LED as part of the SMART portfolio of products.” The transaction is subject to required regulatory approvals and satisfaction of customary closing conditions, and is targeted to close in the first calendar quarter of 2021. Following the closing of the transaction, SMART will license and incorporate the Cree LED brand name into the SMART portfolio of businesses.
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November 27 2020 3:37 pm V18.13.10-1