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Why Wolfspeed Plunged Today

TheMotleyFool

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Why Wolfspeed Plunged Today: https://g.foolcdn.com/editorial/images/822637/gettyimages-1572021668.jpg

Shares of silicon carbide chip manufacturer (NYSE: WOLF) sank on Monday, falling 34.4% as of 12:18 p.m. ET.

Wolfspeed issued a press release today noting it plans to declare Chapter 11 bankruptcy in order to restructure its significant debt load.

This move had been telegraphed earlier in May, as Wolfspeed ran into funding struggles earlier this year when the government didn't follow through on an expected CHIPS Act subsidy. But while many bankruptcies lead to a "zero," it appears equity holders will at least retain a shred of the company going forward.

Source Fool.com