|Cree to sell lighting division for $310 million|
By Lauren Ohnesorge – Senior Staff Writer, Triangle Business Journal
Mar 15, 2019, 9:41am EDT Updated Mar 15, 2019, 3:41pm EDT
A year after its big pivot, Durham’s Cree (Nasdaq: Cree) is selling its entire lighting division to Illinois-based Ideal Industries Inc. in a $310 million deal
CEO Gregg Lowe was not available to talk about the news Friday.
Cree expects to receive an initial cash payment of $225 million, subject to price adjustments and has the potential to receive a targeted earn-out payment of about $85 million based on the adjusted EBITDA metric for the lighting business over a 12-month period that starts two years after the deal closes.
According to a securities filing, the deal has already been approved by the boards of both companies. The filing also notes that Ideal “is expected to hire most of Cree’s approximately 1300 employees of the lighting products business.”
If all goes as expected, the deal will close in the fourth quarter of fiscal 2019. In its second quarter, announced in January, the lighting business accounted for $132.5 million in revenue.