Apollo Global Management is nearing a prepackaged Chapter 11 restructuring of Wolfspeed, a semiconductor producer backed by the private equity giant and its lending partners, according to a report by Bloomberg.

The proposed agreement would allow Wolfspeed to restructure billions in liabilities under a court-supervised process with minimal disruption. A restructuring support agreement (RSA) has been negotiated in advance, securing backing from a significant majority of bondholders. Apollo has been a central lender to Wolfspeed since 2023, providing up to $2bn in financing alongside Baupost Group and Fidelity Management, including $750m in interim funding last year.

If implemented, the prepack would see suppliers and unsecured creditors recover in full, while existing equity holders could retain up to 5% of the reorganised company, an unusual outcome in Chapter 11 proceedings. Should creditor support fall short, Wolfspeed may pursue a standard bankruptcy filing, where shareholders would likely be wiped out.

Headquartered in Durham, North Carolina, Wolfspeed manufactures silicon carbide semiconductors used in electric vehicles and power systems. The firm has struggled with operational delays at its wafer facility and failed to refinance $575m in 2026 bonds. Its stock fell 30% on Wednesday, closing at $0.87.

Wolfspeed also received a $750m grant under the US Chips and Science Act, which remains under review by the incoming administration. Renesas Electronics, a key customer and creditor, has played an active role in the restructuring talks, having paid a $2bn deposit tied to a long-term supply agreement.

Neither Apollo nor Wolfspeed commented on the ongoing process, though a formal announcement of the RSA is expected imminently.

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