Centrotherm Plunges After Insurers Halt Cover: Frankfurt Mover
Centrotherm Photovoltaics AG (CTN), a German maker of machines for the solar-power industry, slumped to a record in Frankfurt trading after insurers cut off cover for deliveries because of a “poor market environment.”
Centrotherm plunged as much as 40 percent to 3.08 euros, the lowest since the shares first started trading in 2007. The shares were at 3.57 euros as of 9:50 a.m. local time.
The company said late yesterday that merchandise credit insurers said they will no longer cover deliveries to Centrotherm as a result of the “strained financing situation.” That will hurt liquidity in a “low double-digit” amount in millions of euros.
Centrotherm said it hired a management-consulting firm it didn’t identify to prepare a reorganization plan that would provide the basis for further talks with its banks to secure financing. “Until further notice, open credit and guarantee lines can no longer be utilized given current financing discussions with banks,” the company said.
Solar-cell and panel makers, Centrotherm’s clients, are under pressure after governments in Europe and the U.S. trimmed subsidies, worsening a glut of the devices that has already slashed margins at the top five manufacturers. Centrotherm last month posted a 42.9 million-euro ($54 million) loss before interest and tax in the first three months of 2012 and said it sees no improvement in the first half.
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