Wolfspeed secures $1.5 billion U.S. Department of Defense financing

Wolfspeed, Inc. has received a conditional commitment for up to $1.5 billion in long-term financing from the U.S. Department of Defense’s Office of Strategic Capital. The funding is structured as a 30-year senior secured delayed-draw term loan facility.

The capital is intended to bolster domestic production of silicon carbide materials and wide bandgap power devices, specifically targeting national security applications. Wolfspeed plans to utilize the funds to strengthen semiconductor manufacturing capabilities across silicon carbide and gallium nitride technologies. Key objectives include upgrading gallium nitride epitaxy for electronic warfare and communications infrastructure, as well as developing radiation-hardening capabilities for defense and aerospace use.

The financing will be provided in planned tranches. An initial $600 million is earmarked to refinance existing debt obligations due around 2030, addressing a significant liquidity hurdle for the company. In exchange for the support, Wolfspeed has agreed to issue equity warrants to the government and meet strict parallel funding requirements.