US-based chipmaker Wolfspeed plans to file for bankruptcy, says ‘it would result in…’

US-based chipmaker Wolfspeed has announced its plan to file for Chapter 11 bankruptcy in the country. According to a report by the news agency Reuters, the plan from the struggling chip manufacturer comes under a restructuring agreement with creditors. This move is designed to provide $275 million in fresh financing and reduce its debt by $4.6 billion, or nearly 70%, the company said to Reuters. The restructuring agreement, reached with creditors and Renesas Electronics’ US subsidiary, is a direct response to deepening economic uncertainty driven by changing trade policies and weakening demand, which led Wolfspeed to raise “going-concern doubts” in May. The company intends to seek approval for its pre-packaged plan and emerge from bankruptcy by the end of the third quarter of 2025.

What is pre-packaged bankruptcy and how it can help the company