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(Bloomberg) — A group of lenders led by Apollo Global Management Inc. is providing as much as $2 billion to Wolfspeed Inc. to support the semiconductor maker’s expansion in the US, according to a statement seen by Bloomberg.

The financing makes $1.25 billion of cash immediately available to the company, while another $750 million can be drawn later. It was structured as seven-year secured notes that carry a coupon of 9.875% and can be paid back after three years. 

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The deal shows how even companies with an established presence in the capital markets are finding it attractive to tap private credit for funding. Wolfspeed chose to go this route to limit the number of parties that would have access to its intellectual property and because the private lenders could provide additional financing at a later date, according to people with knowledge of the matter.

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Apollo arranged the deal, which is unrated, and distributed a portion to two other asset managers, according to one of the people, who asked not to be named because details of the transaction are private.

Proceeds support the expansion of two of Wolfspeed’s production facilities to supply silicon carbide wafers to automakers such as Jaguar Land Rover Automotive Plc, the same person said.

Read more: Biden Touts Wolfspeed Chip Factory in Trip to 2024 Battleground

Representatives for Apollo and Wolfspeed declined to comment beyond the contents of the statement. The Information first reported some elements of the transaction earlier on Sunday.

Apollo has arranged other large private financings for publicly-traded companies in recent years, including a $1.8 billion loan to support New Media Investment Group Inc.’s acquisition of Gannett Co. and a $1 billion loan to Bombardier Inc. It also provided a series of debt and preferred equity financings for Hertz Global Holdings Inc.

Durham, North Carolina-headquartered Wolfspeed has an enterprise value of over $7 billion. Its products are used in automotive, renewable energy, defense and aerospace industries.