COHR - Coherent's Silicon Carbide Semiconductor Business to Receive $1 Billion in Investments From Denso and Mitsubishi Electric | Benzinga
- Coherent completes its previously announced strategic review of its silicon carbide business and plans to operate the business as an independent subsidiary
- DENSO and Mitsubishi Electric will each invest $500 million for a 12.5% non-controlling interest in the silicon carbide business
- Coherent to enter into long-term supply agreements with DENSO and Mitsubishi Electric to support their 150 mm and 200 mm substrate and epitaxial wafer demand
PITTSBURGH, Oct. 10, 2023 (GLOBE NEWSWIRE) -- Coherent Corp. (NYSE:COHR), a global leader in materials, networking, and lasers, today announced that DENSO CORPORATION and Mitsubishi Electric Corporation have agreed to invest an aggregate $1 billion in its silicon carbide business (the "Business"). The transaction results from the strategic review process announced in May 2023 for the Business.
Under the terms of the transaction, DENSO and Mitsubishi Electric will each invest $500 million in exchange for a 12.5% non-controlling ownership interest in the Business, with Coherent owning the remaining 75%. Prior to the completion of the transaction, Coherent will separate and contribute the Business to a subsidiary. Coherent will control and operate the Business, which will continue to be led by Sohail Khan, Coherent's Executive Vice President, New Ventures & Wide-Bandgap Electronics Technologies.
In connection with the transaction, the Business will enter into long-term supply arrangements with DENSO and Mitsubishi Electric that support their demand for 150 mm and 200 mm silicon carbide ("SiC") substrates and epitaxial wafers.
"We are excited to expand our strategic relationships with DENSO and Mitsubishi Electric to capitalize on the significant demand for silicon carbide," said Dr. Vincent D. Mattera, Jr., Chair and CEO, Coherent. "After a thorough review of strategic alternatives for our Silicon Carbide business, we determined that the creation of a separate subsidiary and the strategic investments from DENSO and Mitsubishi Electric, two leaders in SiC power devices and modules, is the best path forward to maximize shareholder value and position the Business for long-term growth. The investments from our strategic partners will be used to accelerate our capacity expansion plans and help sustain our leadership position, while ensuring the development of a robust and scalable supply for the rapidly growing market for SiC-based power electronics, largely driven by the explosive growth of the global electric vehicle market."
"We are very pleased to establish a strategic relationship with Coherent, which has a world-class track record in SiC wafer manufacturing. Through this investment, we will secure a stable procurement of SiC wafers, which are critical for BEVs, and contribute to the realization of ...