April 17, 2018 / 10:59 PM / a year ago

Suniva creditor wins U.S. bankruptcy court approval to sell company's assets

(Reuters) - A U.S. bankruptcy court judge on Tuesday granted a request by Suniva’s biggest creditor that will allow it to sell a portion of the company’s solar manufacturing equipment through a public auction.

The development casts fresh uncertainty on the future for Suniva, the company that fought for and won stiff tariffs on solar panel imports from the administration of President Donald Trump in January, but still has not restarted manufacturing at its U.S. factories.

The creditor, SQN Capital Management, said Tuesday’s order by U.S. Bankruptcy Judge Kevin Gross will enable it to attract an investor interested in injecting capital into Suniva’s idled operations. As of February, SQN was owed more than $58 million by Suniva, court papers show.

“The outcome we want is for Suniva to be producing once again,” SQN Chief Executive Jeremiah Silkowski said in a phone interview following a hearing at the U.S. Bankruptcy Court for the District of Delaware in Wilmington.

Through a subsidiary, SQN last month asked Gross to lift a stay that prevents Suniva’s creditors from collecting the company’s debts while it is in bankruptcy.

In its request, SQN said it saw “no reasonable possibility of a successful reorganization within a reasonable time” for Suniva and that it and other lenders could no longer fund the company through the bankruptcy process.

A public auction for the assets will be held at least 30 days following the judge’s order, according to court papers.

At the hearing, Judge Gross granted SQN relief from the stay and at Suniva’s request, amended the company’s debtor-in-possession financing agreement to allow it to fund operations for the weeks ahead.

An attorney for Suniva, Jeremy Ryan, told the judge that the company was still hoping for a positive outcome to the bankruptcy case.

“No one is sure exactly what that is,” Ryan said. “This case has a lot of twists and turns.”

Suniva officials could not be reached for comment following the hearing.

Suniva filed for bankruptcy a year ago, days before it petitioned the U.S. government for trade relief. The Norcross, Georgia-based company argued it could not compete with the cheap imports that dominate the U.S. market.

The Solar Energy Industries Association, the industry’s leading trade group, fought the tariffs, saying they would drive up the cost of solar and lead to thousands of job losses. The group also argued that the tariffs would not be enough to enable Suniva to restart operations.

Reporting by Nichola Groom, editing by G Crosse

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