Cree sells lighting business, focuses on semiconductors

March 19, 2019 //By Julien Happich
Cree sells lighting business, focuses on semiconductors
Cree has announced it is selling its Lighting Products business unit (“Cree Lighting”), which includes the LED lighting fixtures, lamps and corporate lighting solutions business for commercial, industrial and consumer applications, to Ideal Industries.

Ideal also acquired the rights to use and operate under the Cree Lighting brand, which will become a separate operating division of the company and will continue to be led by current management.

Cree expects to receive an initial cash payment of $225 million, subject to purchase price adjustments, and has the potential to receive a targeted earn-out payment of approximately $85 million based on an adjusted EBITDA metric for Cree Lighting over a 12-month period beginning two years after the transaction closes. The transaction is expected to close within the second quarter of 2019.

The agreement continues Cree’s strategy, announced in February 2018, to create a more focused, powerhouse semiconductor company, providing growth capital for Wolfspeed, its core Power and RF business, and equips Cree with additional resources to expand its semiconductor operations. The deal also enables Cree Lighting to gain additional global focus, channel support and investment as it becomes a growth engine for the Ideal team.

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