Suntech's European operations get debt moratorium
Suntech's European subsidiary gets more time from authorities to restructure its debt
NEW YORK (AP) -- Suntech Power Holdings Co., one of the world's biggest solar panel manufacturers, said Tuesday that authorities in Switzerland have granted its main European subsidiary more time to restructure its debts.
The China-based company said it received a six-month moratorium on creditor claims. That comes after the subsidiary in April was granted a provisional two-month moratorium as a result of its continued debt problems.
Suntech CEO David King said the new moratorium gives the subsidiary time to restructure its debt and reach a deal with creditors.
Suntech is one of the world's biggest solar panel manufacturers. In March the company defaulted on a $541 million bond payment. The company ran short of cash after taking heavy losses last year. Suntech said it reached deals with holders of most of the bonds to postpone payment, but the trustee of the bonds declared a default.
The company was also hurt last year by the revelation that one of its business partners faked $680 million in collateral for a loan that Suntech had guaranteed. On top of that, Suntech and other solar panel makers have struggled in recent years because of a sharp drop in solar prices.
Suntech shares rose 3 cents, or 3 percent, to $1.03 in afternoon trading.
