Yingli Set to Get Lifeline From Chinese State-Run Solar Partner

Yingli Green Energy Holding Co., the debt-strapped solar manufacturer that lost almost a third of its value this week, may get emergency funds to refinance.

United Photovoltaics Group Ltd., a Chinese state-owned partner of Yingli, will look for ways to back the company, Chief Executive Officer Alan Li said Thursday in an interview in Beijing. It may cooperate with solar or other government-controlled companies to help Yingli “pull through,” he said.

United PV, a unit of China Merchants New Energy Group, agreed last year to buy equity interests in 300 megawatts of solar plants to be developed by Yingli through 2016. Yingli tumbled more than 40 percent in New York trading on Monday and Tuesday after saying its $2 billion debt may be too burdensome. The company recovered some of that loss Wednesday.

Yingli is seeking investors to remain solvent. Even though it’s the world’s second-biggest solar-panel maker, the Baoding, China-based company has been unprofitable since the second quarter of 2011 while competitors such as Trina Solar Ltd. have snapped back from a solar slump that dragged down prices.

Yingli has focused on gaining market share in China, where lower prices hurt its profitability, said Wang Xiaoting, a Hong Kong-based analyst at Bloomberg New Energy Finance. “It’s difficult to turn the situation around on its own without government support.”

Solar Insolvencies

Solar-panel prices have plummeted more than 67 percent since 2010. That bankrupted more than 30 companies including the main subsidiary of Suntech Power Holdings Co. and Q-Cells SE, which were the top solar suppliers before Yingli took the lead. Changzhou, China-based Trina is now the biggest.

“Manufacturers don’t have excessive profits as before” and the market wants quality, United PV’s Li said. His company and other developers use a list of preferred suppliers for panels and other equipment, encouraging consolidation, he said.

China’s government, which invested heavily in the industry in the past decade, has recently sent mixed signals about its willingness to support solar.

President Xi Jinping raised targets for installations this year while authorities sought to eliminate outdated capacity and encourage companies to pursue mergers or restructuring. The government also allowed Baoding Tianwei Group Co. to default on bond payments last month, a first by a state-owned company in China.

— With assistance by Feifei Shen

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