$Wolfspeed (WOLF.US)$ shares are up 20% Tuesday after the company announced new proposed funding under the CHIPS and Science Act.
Wolfspeed and the U.S. Department of Commerce signed a non-binding preliminary memorandum of terms for up to $750 million in proposed direct funding under the CHIPS and Science Act.
A consortium of investment funds led by Apollo, The Baupost Group, Fidelity Management & Research Company and Capital Group have also agreed to provide Wolfspeed an additional $750 million of new financing.
In addition, Wolfspeed expects to receive $1 billion of cash tax refunds from the advanced manufacturing tax credit under the CHIPS and Science Act, giving the company access to up to $2.5 billion of expected capital in total.
The investments are aimed at supporting Wolfspeed's long-term growth plans and bolstering U.S. production of silicon carbide to power clean energy systems.
"This support galvanizes our ability to expand domestic manufacturing, accelerate innovation in next-generation semiconductor technology, and meet the increasing global demand for silicon carbide," said Gregg Lowe, CEO of Wolfspeed. "As a key player in the semiconductor industry, this proposed investment will enable us to solidify our leadership position with a first-of-its-kind 200mm silicon carbide manufacturing footprint in upstate New York and central North Carolina, while contributing to the resilience and competitiveness of the U.S. supply chain."
