Pittsburgh-based Coherent Corp. said Monday it had closed the $1 billion aggregate investment by DENSO Corp. and Mitsubishi Electric Corp. in Coherent’s silicon carbide semiconductor business.
DENSO and Mitsubishi invested $500 million each for a 12.5 percent non-controlling interest in the company’s silicon carbide (SiC) semiconductor business. At the same time, Coherent entered into an arm’s length long-term supply agreement with both DENSO and Mitsubishi Electric regarding 150 mm and 200 mm substrate and epitaxial wafer demand. Going forward, the company said, operating and capital expenses for Coherent’s SiC semiconductor business will be funded by that business, under the control of Coherent. Sohail Khan, executive vice president of Wide-Bandgap Electronics, will lead the endeavor.
“As I mentioned in October, we are excited to expand our strategic relationships with DENSO and Mitsubishi Electric to capitalize on the significant demand for silicon carbide,” Dr. Vincent D. Mattera, Jr., Chair and CEO of Coherent, said. “I believe that such a close relationship with 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.”
Mattera said the investments will be used to boost capacity expansion plans and sustain the company’s leadership position, while ensuring the company can scale up supply for the growing SiC-based power electronics market. Market growth is fueled lately by the growing electric vehicle market, he said.
When used in electric vehicles and industrial infrastructure, SiC-based power electronics demonstrate the potential to reduce greenhouse gas emissions and accelerate the clean energy transition.
“Through this strategic relationship with Coherent, we will secure a stable procurement of SiC wafers, which are critical for battery electric vehicles, and contribute to the realization of a carbon-neutral society by promoting the widespread adoption of BEVs in all regions around the world,” Shinnosuke Hayashi, president and COO at DENSO, said.