Smith Anderson Advises Wolfspeed on $750 Million Proposed Funding for Silicon Carbide Expansion to Power Clean Energy Solutions

Wolfspeed (NYSE: WOLF), the world’s largest producer of silicon carbide technology and longtime Smith Anderson client, has signed a non-binding Preliminary Memorandum of Terms (PMT) with the U.S. Department of Commerce for up to $750 million in proposed funding under the CHIPS and Science Act. This funding will support Wolfspeed's expansion of silicon carbide technology manufacturing facilities, essential for clean energy tech like electric vehicles, AI data centers and battery storage.

In addition to this proposed federal funding, major investors, including Apollo, The Baupost Group, Fidelity Management & Research Co. and Capital Group, are providing $750 million in financing. Wolfspeed also anticipates $1 billion in cash tax refunds from the IRS over the next several years. Combined, Wolfspeed will have access to up to $2.5 billion to fuel its next-generation technology to support silicon carbide production expansion, according to a company press release.

The expansion will take place at new production facilities in New York and Chatham County, North Carolina. Wolfspeed CEO Gregg Lowe highlighted the importance of this funding for the company’s growth, noting that it enhances Wolfspeed’s industry leadership and strengthens the U.S. semiconductor supply chain.

The CHIPS and Science Act, passed in 2022, aims to boost U.S. semiconductor manufacturing. It offers funding for domestic semiconductor production, tax credits for manufacturing investments and support for research and workforce development in advanced technologies.

Smith Anderson played a key role in representing Wolfspeed in this transformative initiative, with the team, led by Gerald Roach, including Amy Batten, Alex Bowling, Bart Norman and Olivia Meade. Additionally, Dave Horne provides ongoing counsel to Wolfspeed on incentives matters and project development support. Wolfspeed, with the firm’s assistance, previously secured an incentives package from the State of North Carolina and local governments of approximately $1 billion in connection with the Chatham County project.

The firm, which has advised Wolfspeed for more than 20 years, previously guided the company through more than 20 transactions and financings, as well as the development of the Chatham County state-of-the art, multi-billion dollar silicon carbide technology facility.

Wolfspeed pioneered the silicon carbide technology at North Carolina State University over 35 years ago. Today, the company remains at the forefront of the rapidly growing semiconductor industry.

The full announcement can be viewed here.