US chip component manufacturer Wolfspeed has filed for bankruptcy under Chapter 11 of the US Bankruptcy Code, according to its press release.
The bankruptcy procedure under this article allows reorganisation of assets and liabilities to overcome the crisis. The company expects to emerge from this procedure by the end of the third quarter.
Wolfspeed expects the restructuring agreed to with its creditors will reduce its total debt level by 70%, which “represents a reduction of approximately $4.6 billion and a reduction in its annual total cash interest payments of approximately 60%,” the press release notes.
The company plans to continue business as usual during the bankruptcy proceedings.
Wolfspeed shares soared 80.1 percent in early trading Tuesday.