MACOM Buys Wolfspeed's Radio Frequency Business for $125 Million

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Wolfspeed (WOLF) agreed to sell its radio frequency business, Wolfspeed RF, to semiconductor products supplier MACOM Technology Solutions (MTSI) for $125 million, the companies announced on Tuesday.

MACOM will pay $75 million in cash, and $50 million of MACOM's common stock. The transaction is expected to close by the end of this year.

Wolfspeed's radio frequency business generates annualized revenues of approximately $150 million, and includes a portfolio of gallium nitride on silicon carbide products used in microwave appliances, as well as in aerospace, defense, industrial, and telecommunications sectors.

Under the terms of the deal, MACOM will acquire a wafer fabrication facility in North Carolina that will become fully functional approximately two years after the acquisition is completed. MACOM will also be assigned or licensed over 1,400 patents associated with the RF business as well as design teams, associated product development assets and production capabilities in California and Malaysia. About 280 employees will join MACOM if the deal progresses, with more expected when the fabrication facility comes online.

MACOM said it expects the acquisition to boost its earnings, and Wolfspeed said the proceeds from the deal could help it better focus on its silicon carbide power device and material businesses.

Wolfspeed and MACOM shares gained about 3% in early trading on Tuesday following the news.

Wolfspeed. "Wolfspeed to Sell RF Business to MACOM for $125 Million."

MACOM. "MACOM Announces Definitive Agreement to Acquire the RF Business of Wolfspeed, Inc."