June 24, 2025 /SemiMedia/ — U.S. silicon carbide (SiC) chipmaker Wolfspeed has announced plans to file for Chapter 11 bankruptcy under a pre-packaged agreement that aims to reduce roughly $4.6 billion in debt and restructure its capital base.

The restructuring deal is backed by major creditors including Renesas Electronics and Apollo Global Management. It will cut annual interest expenses by nearly 60% and provide the company with $275 million in new financing. Wolfspeed said it has $1.3 billion in cash and will continue to fulfill its commitments to customers and suppliers.

Under the plan, creditors will swap their debt holdings for equity and assume control of the company, while existing shareholders will retain between 3% and 5% of the reorganized firm. The company acknowledged it may be delisted from the NYSE temporarily during the process.

Wolfspeed expects to emerge from Chapter 11 by the end of Q3 2025 and will appoint a new board of directors. It emphasized that its operations — including its leading-edge 200 mm SiC wafer fab — will continue, ensuring uninterrupted supply to key industries such as electric vehicles, renewable energy, and industrial automation.

The restructuring may reshape the U.S. SiC semiconductor landscape and create openings for competitors such as Infineon, STMicroelectronics, and ROHM.