2 Min Read
March 14 (Reuters) - Cash-strapped Suntech Power Holdings Co Ltd said it was contacted by the New York Stock Exchange regarding unusual trading of its American depositary shares on Thursday.
The China-based solar panel manufacturer said it was aware of recent market rumors and third-party reports regarding its financial position, but was not aware of the events that triggered Thursday's unusual trading activity.
Suntech's shares fell sharply during morning trading, but recovered to close down 19 percent at $0.67 on the New York Stock Exchange.
The company, which has a market capitalization of about $150 million, is struggling to pay out a $541 million bond due this Friday, prompting speculations that it might not be able to defer its obligations.
The company said on Monday that it had reached an agreement with some of its bond holders, getting a two-month reprieve on the repayment.
"We believe Suntech's day of reckoning is at hand with no legal deal to defer maturity, principal unlikely to be paid, and bondholders set to file involuntary bankruptcy this Friday," Maxim Group analyst Aaron Chew said in a note to clients.
Suntech, which had debt of $2.2 billion at the end of March 2012, has been losing money, hurt by a steep fall in solar panel prices.
Rapid capacity expansion in China and a drop in demand in top market Europe sent prices into a tailspin over the past two years, making profits elusive for solar product makers.