RTTNews | Oct 19, 2020 06:15AM EDT

06:14 Monday, October 19, 2020 (RTTNews.com) - Cree, Inc. (CREE) announced agreed Monday to sell its LED Products business unit to SMART Global Holdings, Inc. (SGH) for up to $300 million, including fixed upfront and deferred payments and contingent consideration.

The transaction is part of Cree's transformation to focus on silicon carbide and gallium nitride devices, as well as materials

Under the terms of the agreement, , Cree expects to receive an initial cash payment of $50 million upon closing and $125 million to be paid upon maturity of a seller note issued by SMART to Cree due August 2023.

Cree also has the potential to receive an earn-out payment of up to $125 million based on the revenue and gross profit performance of Cree LED in the first full four quarters post-transaction close, also payable in the form of a three-year seller note.

The transaction, approved by the Company's board of directors, is subject to required regulatory approvals and satisfaction of customary closing conditions, and is targeted to close in the first calendar quarter of 2021.

Following the closing of the transaction, SMART will license and incorporate the Cree LED brand name into the SMART portfolio of businesses.

Read the original article on RTTNews ( https://www.rttnews.com/3137073/cree-to-sell-led-business-to-smart-global-holdings-for-up-to-300-mln-quick-facts.aspx)

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