November 6, 2012 / 8:46 AM / 5 years ago

UPDATE 1-LDK Solar, Sumitomo end solar supply contract

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Nov 6 (Reuters) - Chinese solar power equipment maker LDK Solar has agreed to end its solar wafer supply contract with Sumitomo Corp, and will receive $33.4 million from the Japanese conglomerate.

The eight-year supply agreement was signed in 2008 and Sumitomo had made an advanced payment of a part of the contract's value to LDK Solar. LDK Solar did not specify a reason for the contract's termination.

"We look forward to establishing a new commercial relationship with Sumitomo. We will continue to work closely with our customers and partners as we navigate the current industry challenges," chairman Xiaofeng Peng said on Tuesday.

LDK Solar said it was assessing the financial impact of the contract termination and related charges on 2012 earnings.

Prices for solar panels have crashed in the past two years, hitting profit across the sector. Chinese firms face additional pressure from anti-dumping fights with Europe and the United States.

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