Suntech Power Holdings Co., the Chinese maker of solar panels whose main unit is reorganizing in the Cayman Islands, told a Manhattan court that an involuntary bankruptcy petition against it in the U.S. could derail restructuring efforts.
The creditors seeking the U.S. bankruptcy are a “tiny minority,” holding only 0.27 percent of the company’s outstanding debt, Suntech said in papers filed yesterday seeking to have the case dismissed.
The creditors’ action could “derail the substantial progress Suntech has made in reaching a consensual restructuring with a wide array of its stakeholders, including a substantial percentage of its funded debt creditors,” the company said.
Suntech American depositary receipts, each worth one ordinary share, fell 30 percent to 88 cents at 4:15 p.m. in New York, compared with a closing high for the year of $1.87.
Trondheim Capital Partners LP, Michael Meixler and Longball Holdings LLC filed the involuntary petition under Chapter 7 of the U.S. Bankruptcy Code in New York on Oct. 14. They said they held $578,230.68 in claims against the company.
The petitioners didn’t follow proper procedure, Suntech said in its filing. Some claims were acquired just before the case was started, a sign they were bought for the purpose of trying to force Suntech into U.S. bankruptcy, the company said.
Wuxi, China-based Suntech, the world’s biggest solar-panel maker in 2011, said it’s incorporated in the Cayman Islands and has no operations or significant assets in New York. It has $541 million of senior notes outstanding and a $50 million convertible loan, according to court papers.
On Sept. 23, Suntech reached a deal with Clearwater Capital LLC and Spinnaker Capital Ltd., which act for noteholders with more than 48 percent of its notes, on how it will reorganize. The agreement calls for a debt-for-equity swap for the noteholders.
The company’s main unit was pulled into bankruptcy proceedings by Chinese banks after it 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 case is In re Suntech Power Holdings Co.; 13-bk-13350, U.S. Bankruptcy Court, Southern District of New York (Manhattan.)