LED components specialist Cree has announced it is to acquire LED Lighting Fixtures (LLF) as part of plans to accelerate its push into the booming market for energy efficient lighting.

The deal is expected to close next month and will see Cree shell out $77m in cash and stock, with an additional $26.4m to be paid over the next three years subject to the company's performance post-acquisition.

Cree said the move would provide access to the commercial and residential lighting market and give it control over the entire LED manufacturing process, from LED chips and components through to the end product.

LLF's claims that its solid state lighting uses only 12 watts of power, 85 per cent less than traditional incandescent bulbs, and can be retrofitted into existing light sockets. It also insists that it offers a more environmentally friendly alternative to energy efficient CFL bulbs, arguing that its LEDs generate a softer light, use 50 per cent less energy and contain no mercury.

"The combination of Cree's lighting-class LEDs and LLF's lighting-systems technologies should set the stage for Cree to obsolete the light bulb, a 19th century invention that wastes energy and pollutes our environment," said Chuck Swoboda, chief executive officer of Cree, adding that the lighting market is fast approaching a "tipping point" with billions of sockets in existing fixtures now addressable with energy-efficient LED lighting.

Cree said that following the acquisition LLF will be renamed Cree LED Lighting Solutions. Neal Hunter, chairman and chief executive officer of LLF and previously co-founder of Cree, will also rejoin the company as president of the new division.