SolarWorld aims for deal with creditors in 2-3 weeks -sources

Thu Apr 18, 2013 8:57am EDT

Related Topics

* SolarWorld, creditors seek 'sustainable solution' -sources

* Filing for insolvency not part of considerations - sources

* Debt-equity swap under discussion - sources

FRANKFURT, April 18 (Reuters) - SolarWorld and its creditors are aiming to strike a deal on the restructuring of the ailing Germany-based maker of solar panels within the next 2-3 weeks, two sources familiar with the talks said on Thursday.

"We are looking at a reasonable, sustainable solution that would not require SolarWorld to file for insolvency," one of the people said.

Creditors would cancel some debt and swap some loans for equity, the sources said. Shareholders will likely be left with significantly less than 10 percent of the equity, one of the sources said.

A third person familiar with the situation said that a debt-equity swap was one of the possible options.

SolarWorld declined to comment. Houlihan Lokey, which is advising SolarWorld, and Macquarie, advisor to the company's creditors, both declined to comment as well.

SolarWorld, laden with 900 million euros ($1.2 billion) in liabilities, is struggling with weak demand, industry overcapacity and falling government subsidies.

The company, once Germany's biggest solar group, said on Wednesday that its estimated 2012 loss amounted to half of its nominal share capital and its equity capital was negative at about 20 million to 50 million euros.

Plunging solar module prices and asset writedowns led to a 2012 loss of 520 million to 550 million euros, it said, adding an ongoing audit of its books may "significantly modify" this estimate, SolarWorld said on Wednesday.

Shares in the group were down more than 24 percent by 1122 GMT.

SolarWorld's struggles follow debt restructurings at former German solar heavyweights Conergy and Q-Cells , the latter of which filed for insolvency last year.

SolarWorld has long campaigned for steps against alleged price dumping in the solar industry and led European solar panel manufacturers to take respective steps in the United States and Europe, blaming Chinese peers of receiving state subsidies to flood the EU with panels sold below cost and putting Europeans out of business to corner the market.

($1 = 0.7668 euros) (Reporting by Arno Schuetze, Alexander Huebner, Anneli Palmen)

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