Nov. 7 (Bloomberg) -- Suntech Power Holdings Co., the Chinese solar manufacturer whose main unit was dragged into bankruptcy in March, filed for provisional liquidation in the Cayman Islands and may also seek protection from creditors in the U.S.
The Cayman Islands petition, where the company is incorporated, will provide time to complete restructuring negotiations, Suntech said in a statement yesterday. If approved, the company will consider filing for Chapter 15 bankruptcy protection in the U.S., where its American depositary receipts are listed and it has public debt.
The ADRs, each worth one ordinary share, fell 17 percent to $1.25 at the close in New York, the most since May 22.
Suntech’s main unit, was pulled into bankruptcy proceedings by Chinese banks after the Wuxi, China-based company missed a bond payment in March. Shunfeng Photovoltaic International Ltd., agreed to buy the unit on Nov. 1 for 3 billion yuan ($492 million). The company was the world’s biggest solar panel maker in 2011.
Suntech reiterated yesterday that it has an agreement with creditors that includes a recapitalization and restructuring plan, which involves a debt-to-equity swap and the entry of a strategic investor.
The company intends to challenge a petition for involuntary bankruptcy filed against it in the U.S. by four bondholders last month, it said Oct. 31. The investors hold less than 0.3 percent of Suntech’s convertible senior notes that were due in March and went unpaid.
Investors funneled $1.28 billion into the solar company in bond and stock sales since 2005, the bondholders’ filing shows.
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