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
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