News: Microelectronics
8 October 2026
Wolfspeed receives conditional $1.5bn loan commitment from US Department of War
Wolfspeed Inc of Durham, NC, USA — which makes silicon carbide (SiC) materials and power semiconductor devices — has received a conditional loan commitment letter from the US Department of War (DoW), through its Office of Strategic Capital (OSC), for up to $1.5bn of long-term (30-year) financing to support the domestic development and production of silicon carbide (SiC) materials and wide-bandgap power devices, with an additional focus on US national security applications.
Beyond supporting the domestic wide-bandgap supply chain, which is critical to the US defense and economic industrial base, the $1.5bn commitment will advance key DoW initiatives. Specifically, Wolfspeed plans to use the financing to, without limitation, upgrade its gallium nitride (GaN) epitaxy capabilities for next-generation communications infrastructure and electronic warfare systems and develop radiation-hardening capabilities for its existing SiC and future GaN products.
“SiC and GaN have critical national security applications,” notes CEO Robert Feurle. “With this financing, the company would be well positioned to not only continue to serve the DoW but also expand its capabilities for the benefit of US national security as a whole.”
Wolfspeed believes that SiC and related semiconductor technologies are critical to next-generation power and radio-frequency applications across defense, aerospace, AI, critical infrastructure and other strategic commercial markets. Building on its silicon carbide technology and intellectual property, and domestic manufacturing footprint in North Carolina, New York and Arkansas, the potential financing is expected to advance a multi-year program to:
- strengthen Wolfspeed’s domestic silicon carbide materials and power device leadership;
- establish, expand and/or onshore domestic low-voltage and/or high-voltage GaN power device production capabilities;
- advance GaN-on-SiC radio-frequency epitaxial wafer technology; and
- develop domestic radiation-hardening capabilities.
“The scale and 30-year tenor of this conditional commitment reflects the long-term importance of the technology and manufacturing capabilities Wolfspeed has built in the United States,” says Feurle. “This financing would strengthen our continued advancement of silicon carbide materials and wide-bandgap power devices, reinforcing our efforts to build a more resilient US semiconductor and defense industrial base.”
Transaction details
The conditional commitment letter contemplates a senior secured delayed-draw term loan facility of up to $1.5bn. “This conditional 30-year commitment represents another significant milestone in our ongoing efforts to optimize Wolfspeed’s capital structure and improve our financial foundation,” says chief financial officer Gregor van Issum. “Subject to the satisfaction of diligence, negotiation of definitive agreements, and other financial, legal and investment conditions, the broader commitment is expected to provide additional long-dated capital to support our strategic priorities, improve financial flexibility, and further position Wolfspeed for long-term value creation.”
In connection with the potential financing and subject to the negotiation and execution of definitive agreements, Wolfspeed would be required to issue to the DoW VWAP (volume-weighted average price)-based warrants to purchase, in aggregate, up to 7.5% of Wolfspeed’s fully diluted equity, with the warrants issuable pro rata as and when financing tranches are funded.
Wolfspeed notes that execution of the definitive agreements and consummation of the potential financing are subject to substantial due diligence and numerous conditions, the negotiation and finalization of agreements, significant closing conditions, governmental authorizations and approvals, appropriations and required third-party consents. There can be no assurance that definitive agreements will be executed or that any financing will be provided.
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