Cree buys Intrinsic for $46 million

With the acquisition of Intrinsic (Dulles, Vir.), Cree (Durham, N.C.) expands its efforts into the silicon carbide (SiC) arena. Intrinsic was founded in 2002, with the mission of developing materials and device technologies based on SiC and GaN wafers.

This will enable Cree to accelerate development of larger-diameter SiC wafers. It will enable new, high-power semiconductor devices and lower-cost LEDs.

"Intrinsic has developed the first commercially available, zero micropipe SiC substrates using their ZMP technology," said Chuck Swoboda, Cree's chairman and CEO, in a statement.

"We believe the combination of Cree's technology and manufacturing expertise with Intrinsic's ZMP technology will accelerate the commercialization of low-defect 100-mm and 150-mm substrates," he said. "These substrates should not only support our cost roadmap for LEDs, but more importantly, they should also enable us to more rapidly commercialize higher-power devices for motor-control applications and hybrid vehicles,"

Under the terms of the agreement, Cree will acquire all of the outstanding Intrinsic capital stock and options based on a valuation of $46 million, with approximately $43.5 million to be paid in cash for the outstanding stock and the remainder to be paid through the assumption of outstanding The transaction is expected to be completed during July 2006 and should not have a material impact to Cree's fiscal 2007 earnings. Cree expects to incur approximately $325,000 of nonrecurring costs in completing the acquisition.