Wolfspeed Soars 30% After Cancels Its Old Stock And Issues New Shares As Part Of Restructuring Plan

Wolfspeed canceled its previously issued and outstanding shares on Monday as part of a bid to slash debt and exit bankruptcy.

Shares of Wolfspeed jumped another 30.6% in premarket trading on Tuesday.

The semiconductor company noted in a Form 8-K filed with the Securities and Exchange Commission that existing shareholders received their pro rata share of 1.3 million shares of common stock at an exchange ratio of 0.008352(roughly 1 new for 120 old).

The company issued new shares without changing its ticker symbol. As of Monday, Wolfspeed had a new float of roughly 25.84 million. This compares to a previous 156.48 million shares for the old listing.

The New York Stock Exchange confirmed the change in a notice last week, writing that the common stock issued by Wolfspeed was part of a new security offering that would begin trading under the ticker WOLF on Sept. 29.

Trading was paused due to volatility midday. Wolfspeed shares closed at $22.1 on Monday.

The NYSE will delist Wolfspeed's old common stock effective Oct. 10, according to an SEC filing. For now, trading of the old stock has been suspended.

The development came as the company shifted its incorporation to Delaware from North Carolina as part of a continuing restructuring plan.

Wolfspeed said in June that it had signed a deal with creditors to cut around $4.6 billion in debt and slash total cash interest payments by 60%. Days later, the company formally filed for Chapter 11 bankruptcy.

Earlier this month, the company said its Chapter 11 reorganization plan had been approved in court, and that it planned to exit bankruptcy in the coming weeks.