Wolfspeed receives court approval for reorganization plan

DURHAM, N.C. - Silicon carbide technology company Wolfspeed, Inc. (NYSE:WOLF), currently trading at $1.24 and down nearly 85% over the past year according to InvestingPro data, announced Monday it has received court approval for its Plan of Reorganization and expects to emerge from Chapter 11 bankruptcy protection within the next several weeks.

Upon completion of the restructuring process, the company plans to reduce its debt by approximately 70%, according to a press release statement. This restructuring is crucial given Wolfspeed’s total debt of $6.7 billion and a concerning current ratio of 0.36, as revealed by InvestingPro data. Wolfspeed filed for Chapter 11 protection in the United States Bankruptcy Court for the Southern District of Texas.Want deeper insights? InvestingPro’s comprehensive research report on Wolfspeed offers detailed analysis of the company’s financial health, with 13 additional key insights available to subscribers.

"We believe that strengthening our capital structure will help us to shape Wolfspeed into a leader in its industry," said Robert Feurle, Chief Executive Officer of Wolfspeed. "We look forward to emerging with the financial flexibility to move swiftly on our strategic priorities." The restructuring comes as the company faces significant challenges, with an EBITDA of -$216.2 million and a gross profit margin of -3.23% in the last twelve months.

The company, which specializes in silicon carbide technologies used in various applications including power modules and discrete power devices, indicated the restructuring would better position it to execute on strategic priorities with a focus on innovation. With a market capitalization of $192.46 million and revenue of $757.6 million in the last twelve months, Wolfspeed aims to reverse its recent performance decline.Access comprehensive analysis and real-time updates on Wolfspeed and 1,400+ other stocks through InvestingPro’s exclusive research reports and financial tools.

Wolfspeed is working with several advisors through the restructuring process, including Latham & Watkins LLP and Hunton Andrews Kurth LLP as legal counsel, Perella Weinberg Partners as financial advisor, and FTI Consulting as restructuring advisor.

The company’s senior secured noteholders are being represented by Paul, Weiss, Rifkind, Wharton & Garrison LLP and Moelis & Company, while convertible debtholders are working with Ropes & Gray LLP and Ducera Partners.

Information about the company’s Chapter 11 case is available through Wolfspeed’s claims agent, Epiq.

In other recent news, Wolfspeed, Inc. has announced significant developments regarding its financial restructuring. The company filed for Chapter 11 bankruptcy protection as part of a pre-packaged plan designed to reduce its debt by approximately 70%, equating to a reduction of about $4.6 billion. This restructuring plan is backed by more than 97% of Wolfspeed’s senior secured note holders and over 67% of its convertible note holders. The move is expected to significantly decrease annual cash interest payments by around 60%. Wolfspeed aims to complete this process and emerge from bankruptcy by the end of the third quarter of 2025. Additionally, Wolfspeed has appointed Gregor van Issum as its new Chief Financial Officer, effective September 1, 2025, succeeding Kevin Speirits. These developments come as Wolfspeed looks to stabilize its financial position and leadership team.

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