Tag Archive for: M&A

Infineon to acquire Wolfspeed for $850M

Infineon Technologies AG and Cree, Inc. announced today that Infineon has entered into a definitive agreement to acquire the Wolfspeed Power and RF division of Cree. The deal also includes the related SiC wafer substrate business for power and RF power. The purchase price for this planned all-cash transaction is US Dollar 850 million (approximately Euro 740 million). This acquisition will enable Infineon to provide the broadest offering in compound semiconductors and will further strengthen Infineon as a leading supplier of power and RF power solutions in high-growth markets such as electro-mobility, renewables and next-generation cellular infrastructure relevant for IoT.

Dr. Reinhard Ploss, CEO of Infineon Technologies AG, said: “Joining forces with Wolfspeed represents a unique growth opportunity. Wolfspeed’s and Infineon’s businesses and expertise are highly complementary, bringing together industry leading experts for compound semiconductors. This will enable us to create additional value for our customers with the broadest and deepest portfolio of innovative technologies and products in compound semiconductors available in the market. With Wolfspeed we will become number one in SiC-based power semiconductors. We also want to become number one in RF power. This will accelerate the market introduction of these innovative technologies, addressing the needs of modern society – such as energy efficiency, connectivity and mobility.”

Infineon's wolfspeed acquisition conditions - Cree

Extract from Infineon presentation

Chuck Swoboda, Cree Chairman and CEO, said: “After much consideration and due diligence over the past year, we concluded that selling Wolfspeed to Infineon was the best decision for our shareholders, employees and customers. We believe that Wolfspeed will now be able to more aggressively commercialize its unique silicon carbide and gallium nitride technology as part of Infineon.”

Frank Plastina, Wolfspeed CEO, said: “By joining the Infineon team, Wolfspeed will now have all the advantages of a global company in our sector, including the ability to leverage Infineon’s market reach and infrastructure. With Infineon’s complementary culture and additional investment, we’ll be better positioned to unlock the potential of our portfolio and our people.”

Wolfspeed is based in Research Triangle Park, North Carolina, USA, and has been a part of Cree for almost three decades. Wolfspeed is a premier provider of SiC-based power and GaN-on-SiC-based RF power solutions. This also includes the related core competencies in wafer substrate manufacturing for SiC, as well as for SiC with a monocrystalline GaN layer for RF power applications. With these competencies, more than 550 highly skilled employees and a strong IP portfolio of approximately 2,000 patents and patent applications, this deal complements Infineon’s previous acquisition of International Rectifier in early 2015.Wolfspeed’s SiC-based product portfolio ideally adds to Infineon’s offering.

Infineon's wolfspeed acquisition conditions - Cree

Infineon’s wolfspeed acquisition conditions – Cree

Power management solutions based on compound semiconductors have several advantages enabling Infineon’s customers to develop systems with higher energy-efficiency, smaller footprints and lower system costs. Combining the comprehensive portfolios of technologies, products and manufacturing capabilities, Infineon and Wolfspeed will accelerate the development of components enabling customers to develop differentiating systems. Major areas where the applications will profit from SiC are renewables and especially automotive. Both areas benefit from the increased power density and improved efficiency. In automotive it fits well with the recent increased commitment of the industry to plug-in hybrid and all-electric vehicles (xEV). Combining both portfolios and competencies will significantly accelerate the time-to-market for new products based on compound semiconductors.

Next-generation cellular infrastructure standards such as 5G and beyond will use frequencies up to 80 gigahertz. Only advanced compound semiconductors can deliver the required efficiencies at these high frequencies. GaN-on-Si allows higher levels of integration and offers its advantages at operating frequencies of up to 10 gigahertz. GaN-on-SiC enables maximum efficiency at frequencies of up to 80 gigahertz. Both technologies are crucial for next generation cellular infrastructure standards. Together with its Si-based LDMOS products Infineon is the industry’s most complete provider for RF power components.

The combined portfolio advances Infineon’s strategic “Product to System” approach. Additionally, Infineon will benefit from accelerating the adoption of SiC- and GaN-based components in early-adopter markets, e.g. electro-mobility, high-end photovoltaic inverter, xEV charging infrastructure, and RF power components in cellular infrastructure.

The business to be acquired by Infineon has generated pro-forma revenues of US Dollar 173 million in the twelve months ending March 27, 2016. The acquisition will be immediately accretive to Infineon’s adjusted earnings-per-share and margin. Infineon will fund the transaction with bank financing of US Dollar 720 million and US Dollar 130 million of cash-on-hand. Infineon will maintain its strong balance sheet after the cash- and debt-financed transaction. Infineon’s capital structure will stay well within the previously communicated targets of Euro 1 billion gross cash plus 10 to 20 percent of revenue, and no more than two times the gross debt-to-EBITDA.

Cree’s Board of Directors and Infineon’s Supervisory Board have approved the acquisition. The closing of the transaction is subject to regulatory approvals in various jurisdictions and is expected by the end of calendar year 2016.

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Valeo plans a joint venture with Siemens for powertrains

The joint venture would capitalize on Valeo’s and Siemens’ leading positions in their respective sectors, with the ultimate goal of creating a global leader in the fast-growing market of automotive electrification.

The two industry leaders would join forces to offer the most complete and innovative range of high voltage (above 60V) components and systems for all types of electric vehicles (hybrids, plug-in hybrids and full electric vehicles): e-motors, onboard chargers, inverters, DC/DC converters.

Valeo would contribute to the joint venture its high voltage power electronics business (onboard chargers, inverters, DC/DC converters) employing around 200 people of which 90 are based in France. Its under-60V powertrain activity would not be part of this joint venture. Siemens would contribute to the joint venture its E-Car Powertrain Systems Business Unit (e-motors, inverters) employing around 500 people of which 370 are based in Germany and 130 in China.

The joint venture would be headquartered in Erlangen, Germany.

The newly created entity would leverage on Valeo’s and Siemens’ strong complementarity in terms of product portfolio and geographical spread generating synergies in manufacturing and sourcing. Its strengths in production and development would allow to target customers on a global level as well as in specific key markets.

“We are delighted at the perspective of combining our strengths with Siemens in electrified powertrain systems,” said Jacques Aschenbroich, Chairman and Chief Executive Officer of Valeo.

“With the expertise offered by Siemens, a leader in power electronics and electric motor products, Valeo would maintain its technological lead by offering a comprehensive line-up of technologies ranging from micro-hybrid to all-electric solutions. This joint venture also illustrates the ability of European companies to develop leading industrial partnerships to bring breakthrough technologies to the global market.”

 

Klaus Helmrich, Member of the Managing Board of Siemens AG, said: “The Valeo Siemens joint venture is yet another example of forming a true Europe based company. Combining Siemens’ extensive experience in electric motors and inverters with Valeo’s automotive business expertise and worldwide customer base would provide both companies with a solid basis in the growing electro mobility market.”

The project is subject to consultation of the employee representatives and approval by the relevant authorities.

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Fairchild – ON Semi deal is not done yet!

ON Semi’s offer of 20$ per share, representing a total of 2.4B$ as been beaten by a better offer.

The new bidder offered 21,70$ per share. The origin of the offer is still anonymous, and is being examined by Fairchild’s board. Several sources relate that the new offer comes from a group led by China Resources Holding.

Among the issues posed by selling Fairchild to a Chinese company, is the fact that the offer needs to be reviewed and approved by the CFIUS (Committee on Foreign Investment in the U.S.), an agency that has scuttled transactions involving Chinese SOEs. Phoenix based ON Semiconductor’s offer had the advantage to keep the US flag floating over Fairchild’s headquarter.

China’s willing to acquire Power semiconductor technology is not new. The country has been actively working on developing it’s own technologies. Even if they master now the manufacturing of IGBTs. They are still late as the technology used is quite old and not as advanced as the one you could find at power semiconductor dinosaurs like Infineon, Mitsubishi, and Fairchild. The development of T&D and Smartgrid needs as well as electric mobility put China in need of sourcing such technology.

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IDT to Acquire ZMDI for $310 Million

Integrated Device Technology, Inc. (IDT®) (IDTI) today announced an agreement to acquire privately held ZMDI (Zentrum Mikroelektronik Dresden AG) for total consideration of $310M in cash. The acquisition provides IDT with a highly regarded Automotive & Industrial business, and extends their technology leadership in high performance programmable power devices and timing & signal conditioning.

Automotive & Industrial provides a significant new growth opportunity. IDT gains immediate leverage for new designs in Wireless Charging, Power Management, and Timing & Signal Conditioning. ZMDI’s business is already well established and positioned for growth, and benefits immediately from IDT’s scale and technology.

“This move accelerates progress to our $800M annual revenue goal within our industry benchmark financial performance by over a year,” said Gregory Waters, IDT President & CEO. “IDT’s strategy is unchanged, but our product and technology position is significantly expanded. Our target market segments of Consumer, Communications, and High Performance Computing all benefit from additional product, revenue, and customer relationships that bolster our commitment to outgrow the semiconductor market by at least a factor of two.”

IDT extends their rapidly growing line of programmable power devices, with new high-power products addressing Communications Infrastructure and Data Center applications. This creates a new industry franchise for high performance, scalable power management solutions that cover applications ranging from Wireless Charging to Solid State Drives to Data Centers & 4G/5G basestations.

“We gain an exceptional group of talented people and intellectual property from ZMDI, who join one of the technology industry’s fastest growing companies. With the added benefit of IDT’s cost structure and high volume manufacturing capability, we expect ZMDIrevenues to achieve a similar financial model as IDT’s existing business in the first year of combined operations,” Waters added.

ZMDI’s signal conditioning products provide an elegant interface between microcontrollers and analog components, such as sensors. This is extremely complimentary to IDT’s Advanced Timing products, and will enable intelligent systems that are aware of their surroundings, and can adjust system performance, timing, and power management automatically.

“We’re enthusiastic to join with IDT, and create the best positioned product innovation team in the mixed-signal semiconductor industry,” said Thilo von Selchow, President and CEO of ZMDI. “It’s rare to see such a potent combination that not only provides a powerful financial result, but more importantly establish the product and technology teams that will lead the industry in innovative new products and growth for this decade.”

The transaction has been unanimously approved by the board of directors of both companies, with closing expected before calendar end.

 

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Transphorm raising another 70$M for GaN semiconductor

Transphorm Inc, a GaN devices manufacturer, today announced a $70 million investment round led by  KKR. KKR’s investment follows initial rounds of funding from Kleiner Perkins Caufield and Byers, Foundation Capital, Google Ventures, Soros Quantum Strategic Partners, INCJ, Fujitsu, Transphorm will use this funding to support its growth, product innovation and expansion.

“Gallium Nitride is the most important new semiconductor in the world today”

To know more about Gallium-nitride manufacturers and Transphorm:

Check our presentation and map of GaN manufacturers

Gallium nitride devices players map

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Tesla, Mercedes-Benz… Smart-grid is (also) for car makers

Update 20/05/2016:

Nissan partnered with Eaton to integrate used EV batteries in home storage systems. Their solutions integrates the charger, the inverter and can operate as a UPS, as a storage for PV inverters or with energy from the grid, etc.

Update 25/11/2015:

Audi also announced they will re-use batteries for fast chargers or to store and deliver renewable energy during demand peaks. So if you are wondering what all electric car makers are going to do with used batteries, just read below.

 

Well, actually, every big carmaker better not stay just a carmaker to stay big. Some, like Tesla and Mercedes-Benz figured that out. They went on the home battery market, which is to be part of the future of electrical grid or Smart-grid. You don’t naturally make the connection between the smart grid and car markets. Though, and I’m going to tell you why, they are deeply connected.
Which means? Both need to focus on power electronics.

The keys to the electric car market

Let’s think about what are the components and skills to make an electric car.

  1. The energy source: Battery or Hydrogen

The battery is your fuel tank. It’s expensive, bulky, and is the limiting part for your car’s autonomy. Thus everybody talks about it (and they are right) and tries to improve it. Tesla proved it establishing a battery factory.

  1. The conversion

You convert the battery energy into speed, through an electric motor but also some power electronics conversion systems (Point the Gap’s expertise, in case you are wondering…). There is room for improvement here as well, and it’s on-going with the wide bang gap semiconductor revolution. (GaN and SiC semiconductor).

  1. The control (software part)

You also need some smart software to make all these stuff run smoothly together. This is a key part in electric car now. Tesla and many other are working on this control and software revolution of cars: GPS improvements, self-driving, auto-updates adding functionalities to old models…

Carmakers, Train makers. It’s all about transportation energy

Yes, after all, they are both electrical systems made for ground transportation of people and merchandise.

What is essential for a train maker?

  1. The conversion

    • Power electronics is the exact first key thing you need to make a train. High speed train paved the way to innovation in electric traction.

  2. The control

    • Because at 300km/h, you better have some automation in case of emergency. France and Japan did very well on that. Never ever a man died during a high-speed train derailment.

  3. The energy source: Overhead power lines, ground power lines, but no batteries

    • Or maybe just some battery, because you cannot drive a train on battery, but you surely need some comfort in it, and battery is needed for that, during power outlets.
    • But why are battery not so important for a train? Maybe just because it’s energy autonomy is impossible with todays technology. They still are operating with energy sources of a type: overhead for trains and tramways, sometimes ground power lines for metro.

So these two businesses are quite similar in terms of needs. They are just not at the same power level: Kilowatts compared to Megawatts.

Now that we admitted that there are similarities here, let’s dig deeper into train manufacturers.

Electric car and mass transportation: pillars of Smart-grid

Question 1: Cite three train makers?

Yes: Alstom, Siemens, maybe Bombardier, or ABB. As you wish… Mitsubishi, Kawasaki if you live in Japan, CSR (China Southern Railway) if you are Chinese.

Question 2: What’s the link between these companies?

Train market is far to be the sole activity.

All major train makers are not only making trains, but also all sorts of different electric conversion systems at similar power: Electricity transport and distribution, Photovoltaic inverters, Large motor drives, etc…

And these companies have a clear investment strategy into the smart-grid trend and all the current revolutions reshaping the electricity conversion and consumption world. They are deeply involved in smart-grid:

These are only a few examples of how much investment in R&D, projects and time, is made by transportation companies into Smatgrid. The car market, one of the biggest transportation market existing, is no exception.

What is currently happening in the car market will result in something similar to the train market: Major car manufacturers will be also major players of the power electronics world, at their own power range (Kilowatt range rather than Megawatt for train), and will be part of the smart-grid revolutions we are living right now.

Tesla just proved that, by releasing home-batteries, and connecting the car market to the energy market. It’s not their last move, I can tell you. They teamed up with the microinverter company Solaredge in order to build their Powerwall’s conversion part.

Mercedes Benz picture announcing the home battery.

Mercedes Benz picture announcing the home battery.

Mercedes-Benz (Daimler group) did the same a few days ago, announcing their own home battery during Intersolar. By the way, how funny, a car maker making announcements during a solar energy fair…

BYD, the chinese leader in electric car, is also involved in much more businesses, and starting to manufacture their own power semiconductor. Same with General Motors and their fab in Kokomo, IN, and Toyota developing Silicon Carbide devices.

  • Alstom, ABB and Siemens: Smart-grid for transport and distribution of electricity.
  • Tesla, Mercedes-benz, Mitsubishi: Smart-grid for electricity consumption.

The picture is almost complete. Now let’s get things done.

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