June 28 China-based solar panel maker Suntech Power Holdings Co Ltd, whose main unit is in insolvency proceedings, said it had struck a deal with a majority of its bondholders to defer payment on a $541 million loan until Aug. 30, the third time the company has reached such an agreement.
Suntech defaulted on a principal payment on the 3 percent convertible notes on March 15, prompting the company's Chinese lenders to drag its main manufacturing unit into insolvency proceedings.
Lenders holding the senior notes will nominate two additional members to Suntech's board and will help to identify strategic and financial investors to bring in new capital, the company said in a statement on Friday.
Suntech said it was also looking at converting all major debt claims held by the bondholders into equity.
The company reached a deal with 60 percent of the note holders in March to defer payments until May 15, when it announced that it had struck another deal with some lenders to defer obligations until June 28.
At the end of March 2012, Suntech had total debt of $2.2 billion, including loans from China Development Bank, and a $50 million convertible loan from the International Finance Corporation, the private sector arm of the World Bank.
Chinese creditors of the bankrupt unit, Wuxi Suntech, claimed at the start of the debt restructuring process in May that the subsidiary owed them $2.5 billion. The restructuring process is expected to go on for months.
The eastern Chinese city of Wuxi, where Suntech Power is headquartered, is trying to maintain the company's production capacity and save thousands of local jobs.
Suntech has said that its Chinese unit has been experiencing a gradual improvement in business after a court-appointed debt administrator pushed to recover accounts receivable and trimmed inventories.