By Svea Herbst-Bayliss

NEW YORK, Oct 22 (Reuters) -

Activist investor Jana Partners urged Wolfspeed Inc on Tuesday to boost its share price by increasing gross margins, exploring a sale of its device business and pursuing a partial sale of its silicon carbide wafer business to a strategic partner.

Such steps could push Wolfspeed's share price significantly higher, Scott Ostfeld, Jana Partners' managing partner said.

Wolfspeed, the world's largest maker of silicon carbide, closed trading at $15.39 on Monday, having lost 64% this year.

Ostfeld spoke at the 13D Monitor Active-Passive Investor Summit in New York after the firm took a position in the company this year and pushed it to adopt a "back-to-basics" strategy that focuses on better execution and considers strategic opportunities such as a sale.

Last week, Wolfspeed said it added two new directors to its board and was awarded a $750-million grant under the federal CHIPS and Science Act.

Combined with $1 billion in cash tax refunds for advanced manufacturing and a combined investment from investors including Apollo, Baupost Group and Capital Group, the company secured $2.5 billion in total financing to complete building its next-generation silicon-carbide capabilities.

Ostfeld said this addresses Wolfspeed's funding needs, freeing the company to concentrate on running the business better and pushing shares higher.

News of the fresh cash and new directors drove Wolfspeed's shares up last week.

Ostfeld, who has served on a variety of public company boards, said he believes Wolfspeed management shares the hedge fund's sense of urgency to boost performance and the share price.

The hedge fund welcomed Wolfspeed's two new directors. Investment banker Woody Young, one of the new directors, joined Frontier Communications' board in February where Jana had also pushed for a sale. Last month telecom giant Verizon

made a bid for Frontier and investors will vote on the deal next month.

(Reporting by Svea Herbst-Bayliss; Editing by Rod Nickel)

((svea.herbst@thomsonreuters.com; +617 233 2138; Reuters Messaging: svea.herbst.thomsonreuters.com@reuters.net))