- Renesas Electronics Corporation (TSE: 6723) enters a Restructuring Support Agreement with Wolfspeed, Inc. (WOLF, Financial) and its creditors.
- The restructuring involves converting a $2.062 billion deposit into Wolfspeed convertible notes, common stock, and warrants.
- Renesas anticipates a potential loss of approximately 250 billion yen due to this agreement.
Renesas Electronics Corporation (TSE: 6723), a leading semiconductor solutions provider, announced the signing of a Restructuring Support Agreement with Wolfspeed, Inc. (WOLF) and its principal creditors. This strategic move aims to financially restructure Wolfspeed amid its recent challenges. As part of the agreement, Renesas is set to convert a deposit of $2.062 billion into convertible notes, common stock, and warrants issued by Wolfspeed.
The convertible notes amount to $204 million, maturing in June 2031, and are convertible into 13.6% of Wolfspeed's total shares on a non-diluted basis. Additionally, Renesas will acquire Wolfspeed common stock equivalent to 38.7% of the company's total issued shares and warrants representing 5% on a fully diluted basis.
This restructuring is expected to proceed through Chapter 11 proceedings in the U.S. Bankruptcy Court, with Wolfspeed anticipated to file soon. The restructuring aims to be effective by September 2025, contingent upon court approval.
Renesas expects to record a loss on the deposited receivables related to the conversion, estimating a potential loss of approximately 250 billion yen in its financial statements for the six months ending June 30, 2025. The exact timing and amount of the loss will be finalized after consultation with auditors.
