Durham-based Wolfspeed says federal regulators have given permission for a Japanese company to take an equity stake in the chipmaker.
The decision came from the Committee on Foreign Investment in the United States and stems from Wolfspeed’s Chapter 11 restructuring last year.
One of the company’s largest creditors going into the bankruptcy proceedings was Tokyo-based Renesas Electronics, another chipmaker.
It agreed to take a haircut on $2.1 billion in debts in return for stock and a seat on the Wolfspeed board.
But for it being a Japanese company, the move required CFIUS approval.
“CFIUS clearance represents the final milestone in the execution of our prepackaged restructuring,” Wolfspeed CEO Robert Feurle said Friday via a news release.
Renesas CEO Hidetoshi Shibata said last summer that he expected his company to wind up owning about a third of Wolfspeed’s equity.
Wolfspeed escrowed 16.9 million shares of common stock for Renesas in anticipation of regulatory approval.
With that in hand, those shares “are now cleared for release,” Wolfspeed said.
The decision also clears the way for Renesas CFO Aris Bolisay to take a seat on the Wolfspeed board previously reserved for him as part of the restructuring.
Wolfspeed said its stock float, post-release, amounts to about 45.1 million shares. That implies Renesas’ ownership of about 37% of the company.
As of about noon on Friday Wolfspeed’s stock price was down on the day. Post-bankruptcy, it peaked at $35.42 a share and closed trading on Thursday at $17.29 a share.
The chipmaker has acknowledged a slow ramp-up of production at its new chip fab in Upstate New York. It also has a wafer factory in Siler City and other manufacturing facilities in Durham.
The federal scrutiny of Wolfspeed’s dealings comes in part because the company is one of the few in the U.S. capable of turning out custom-designed chips for the military.
