Infineon Technologies AG, Europe’s biggest chipmaker by revenue, agreed to buy Cree Inc.’s Wolfspeed Power unit for $850 million to expand in fast-growing markets such as electric cars and the Internet of Things.

The company is paying cash for Wolfspeed, which makes compound semiconductors and power-management chips, according to a statement. The deal adds to Infineon’s product portfolio, which includes chips for sensors, radars and security.

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