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Wolfspeed makes devices using gallium nitride, a sensitive
powdery compound with military applications which has led the
U.S. to block other deals.
Infineon Chief Executive Officer Rheinhard Ploss told the
chipmaker's annual shareholder meeting there was "a very
significant risk that we will not be able to complete the
takeover as planned or possibly even at all".
The German company said on Feb. 8 that it feared the deal "as
agreed" could fail, suggesting there may be room for remedies,
but Ploss said that U.S. government security panel CFIUS, which
said the deal posed a risk to U.S. security, had not suggested
any measures to address its concerns.
Infineon is making a long-term bet on a new generation of chips
as Wolfspeed helps to make electronic devices operate more
efficiently as its products are smaller, thinner and faster,
lowering power loss in the process.
These silicon carbide chips are expected to gradually replace
conventional chips, particularly for on-board charging in
electric and hybrid cars.
The Wolfspeed deal was announced last year and Infineon had said
as recently as Feb. 2 it could close "any time soon".
If the deal does get blocked by CFIUS, it will follow the
security panel preventing the acquisition of German chip
equipment maker Aixtron by a Chinese buyer last year.
The $3.3 billion sale of Philips' lighting business, Lumileds,
to a consortium of Chinese investors was blocked by CFIUS in
January 2016.
(Editing by David Goodman and Alexander Smith)
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