Wolfspeed anticipates emerging from bankruptcy by the end of September after it has slashed 70% of its debt. Under its proposal, creditors will have their debt obligations converted into equity, and current shareholders will receive either 3% or 5% of new shares.

Wolfspeed shares plunged 30% to an all-time low Monday as the struggling chipmaker announced it had filed for Chapter 11 bankruptcy in order to implement a Restructuring Support Agreement (RSA) with key lenders.

Wolfspeed plans to file for bankruptcy in the United States under a restructuring agreement with creditors, which would provide it with fresh financing and slash debt by nearly 70%, the struggling chipmaker said on Sunday.