So this is big news, see below from Bloomberg. Wolfspeed stock +17% pre-market, Aixtron moved from -2% to +2% intraday today. Lets see what the US market makes out of this for Aixtron. Obviously a first glimmer of hope for more SIC business at Aixtron, given we know that WOLF is an established large customer.
Regards,
Fel
Wolfspeed Wins $1.5 Billion Financing From Chips Act, Apollo (1)
2024-10-15 09:31:20.573 GMT
By Mackenzie Hawkins and Ian King
(Bloomberg) -- Wolfspeed Inc., a manufacturer of chips used
primarily in electric vehicles, is in line to win $750 million
in US government grants as well as $750 million in financing led
by Apollo Global Management Inc. to support its factory
expansion plans.
The grant from the 2022 Chips and Science Act will cover a
portion of the company’s more than $6 billion in planned
spending for factories in North Carolina and New York. The
projects are anticipated to create more than 2,000 manufacturing
jobs and 3,000 construction jobs, the Biden administration said
Tuesday in a statement. The grant spurred the financing from
Apollo, The Baupost Group, Fidelity Management & Research Co.
and Capital Group, according to the statement.
Wolfspeed also plans to tap 25% tax credits for the
facilities, and expects to receive more than $1 billion in total
refunds, Chief Executive Officer Gregg Lowe said during an
earnings presentation in August. It has already accrued around
$640 million in refunds, Lowe said.
Wolfspeed’s shares rose 17% in premarket trading on Tuesday
before New York exchanges opened. Its stock had declined 74%
this year to $11.38 at Monday’s close.
The Chips Act, a landmark bipartisan law championed by
President Joe Biden, is designed to bring semiconductor
manufacturing back to American soil after decades of production
shifting to Asia. Officials have allocated the lion’s share of
$39 billion in grant funding from the program, and they’ve
signed a final agreement on one of nearly 20 awards announced so
far.
Read More: With US Chips Act Money Mostly Divvied Up, the
Real Test Begins
The others — including massive grants to companies like
Intel Corp. and smaller ones like Wolfspeed’s — are preliminary,
subject to due diligence and additional negotiation. After
signing final agreements, companies have to meet project-
specific benchmarks to receive funding as a reimbursement.
The government and private backing may provide a welcome
shot in the arm for Wolfspeed, as the company tries to generate
new production that executives promise will provide it a better
future. The beleaguered chipmaker last posted annual profit a
decade ago and its most recent quarter of positive net income
came in 2018.
Read More: Worst Performing Chip Stock Faces More Gloom in
2024
Wolfspeed’s problems stem from production snarls at a plant
that is one of the largest makers of silicon carbide wafers, on
which its chips are built. Inadequate supply of those wafers is
stifling manufacturing at its chip plant in Mohawk Valley, New
York, forcing the company to rely on an older factory that
carries higher costs.
Wolfspeed now plans to close that facility and shift
production to the newer one, which is one of the two facilities
the Chips Act grant would support. The chipmaker is also in an
area of growing demand — semiconductors that control power in
EVs and other devices — where the use of new materials and
techniques promises rewards for leaders.
“As the world’s largest producer of silicon carbide
material, we believe we have a compelling proposition for a
Chips grant because silicon carbide is considered a matter of
national security, is designated a critical material by the US
Department of Energy, and is essential to the electric vehicle
ecosystem,” Lowe said on the August earnings call.
|
Thread abonnieren
