* Executives testify about contracts once worth $1.2 bln
* Contracts succumbed to rapidly changing solar market
* Company has 25 potential bidders
By Tom Hals
WILMINGTON, Del., Oct 18 Executives from
bankrupt Solyndra LLC testified on Tuesday that a flood of
cheap Chinese solar panels kept it from realizing $1.2 billion
in contracts it announced in 2008.
Three years after Solyndra announced those long-term
contracts, its cumulative sales total a mere $330 million,
company executives said in a meeting with creditors.
The company filed for bankruptcy in early September and
days later was raided by the Federal Bureau of Investigation.
Solyndra has become an embarrassment for the Obama
administration, which provided it a $535 million government
loan that now seems unlikely to be repaid in full.
When the company announced the long-term contracts in 2008,
solar panel prices were higher and developers of solar projects
were scrambling for supply. As a result, three companies
committed to three-year or five-year contracts that were touted
in the 2008 press release, according to Ben Bierman, the
company's vice president of operations.
However, the solar panel market soon changed. China began
pouring billions of dollars of subsidies into panel
manufacturing, driving prices much lower. A dearth of supply
soon became a global glut.
At the same time, cash-strapped European countries cut
incentives for installing solar power projects. As a result,
none of the three companies have placed significant orders
under their contracts with Solyndra this year, Bierman said.
In a meeting with the Department of Justice last month,
company representatives refused to discuss the contracts.
That refusal prompted the government to push the bankruptcy
court to replace management and the board of directors with a
trustee. The court denied that request on Monday.
Tuesday's meeting with creditors was required under the
bankruptcy code. Officials from the Department of Justice
conducted the meeting and Solyndra executives answered
questions under oath about their operations, assets and
The company's financial adviser said Solyndra had received
active interest from 25 potential buyers for all or parts of
its operations. Eric Carlson, of Imperial Capital LLC, said 14
would be considered strategic buyers, the rest financial
However, no party has committed to act as an initial or
"stalking horse" bidder. Bids are due in mid-November.
The bankruptcy case is In re Solyndra LLC, U.S. Bankruptcy
Court, District of Delaware, No. 11-12799