Chipmaker Wolppeed shares rose 1100% in three days, shareholders to receive new ordinary shares – here is why

Wolppeed Inc. shares (Wolf) based in the USA increased on Monday afternoon after the reorganization plan was announced. According to the plan, shareholders will receive new ordinary shares in exchange for their existing actions.

Actions increased by as much as 1,450 percent after restructuring and corporate changes in Chapter 11, which were approved by the US Court at the beginning of September.

Chipmaker has submitted an application bankruptcy In July, the introduction of a supported creditor of the debt plan by $ 4.6 billion, which means one of the largest bankruptcies submitted this year.

How will restructuring bring benefits to the company?

Wolpspeed’s The plan approved by the court will allow the company to leave bankruptcy protection in the coming weeks. Restructuring is expected to significantly reduce its debt by 70 percent, from $ 6.5 billion to $ 2 billion, and interest payments by about 60 percent.

The company produces used systems in applications such as electric vehiclesSolar inverters and power systems. According to Benzing’s media company, Wolppeed will also change its inclusion from North Carolina to Delaware in the United States as part of this process.

What awaits shareholders?

Due to these changes registered by the Company, the New York Stock Exchange suspended the old Wolppeed ordinary shares on Monday, September 29. Old ordinary shares will be removed on October 10 this year.

Current shareholders will receive new ordinary shares in a reorganized company. However, restructuring requires significant divorce, which will lead to the fact that current shareholders will receive only 3-5% of the new own capital, because creditors are aimed at accepting the company’s ownership.

This huge increase in stock price can be attributed to a speculative trade driven with a huge debt reduction. This increase among several commercial detention on Monday morning, For gasoline Reported.

The price of Wolppeed shares

Wolppeed (Wolf) shares were on Monday in the amount of USD 14.97, by about 1,37 percent compared to the previous closing price of $ 1.17 on Friday, September 26.

According to data from the New York Stock Exchange in New York, the company’s shares were appreciated by about 54 percent.