The settlement agreement reached on Suntech is undoubtedly good news for temporary relief, will be able to resolve the crisis in the $ 575 million of convertible bonds due March 15.
The above insiders told reporters Solarzoom reached before the convertible bond creditors programs: $ 285 million of debt, can be divided into a few years to the period also, an annual interest rate of 6%, the but require domestic bank guarantee. GSF now thawed warranty issues can be resolved before the bank does not agree to the guarantees which Suntech bankruptcy crisis. Another $ 285 million will be converted into stock.
With the convertible bond crisis is resolved, Suntech will temporarily survive the bankruptcy crisis. Analysts said, it presumably Zhengrong Shi "blow" is not small, indicating that its further reduce the influence of Suntech.
From Yahoo: "if true, those numbers about half in cash and half in stock seem to be fairly inline with the market expectations based on bond price values and the put options betting on dilution. I thought so."
If it is even true, there will certainly be holdouts. They would have to budget for that.
If there is actually a bondholder agreement, it's with the largest holders only, and they would have to plan on paying the smaller holdouts.
I see the stock price getting crushed from huge dilution. I don't think the big bondholders would agree unless they got more than half the equity.
The current EV through the stock is $470 million. If there was $285 million in new debt then it seems like there wouldn't really be any room for existing equity and claim with a straight face there's $285 million in new stock.
Also, one of the allegedly stated purposes is to dilute Shi. And I don't know why the bondholders would agree to let existing equity keep anything if they are taking a haircut.
CP,
ReplyDeleteHere are latest articles about STP.
http://english.caijing.com.cn/2013-03-07/112569393.html
http://www.solarzoom.com/portal.php?mod=view&aid=25848
I just saw that same solarzoom article.
ReplyDeleteIt sounds like an exchange offer. 50 cents in new debt and then stock. It sounds like huge dilution.
Skeptical of the article, but it is plausible.
What would they do about holdouts?
The settlement agreement reached on Suntech is undoubtedly good news for temporary relief, will be able to resolve the crisis in the $ 575 million of convertible bonds due March 15.
ReplyDeleteThe above insiders told reporters Solarzoom reached before the convertible bond creditors programs: $ 285 million of debt, can be divided into a few years to the period also, an annual interest rate of 6%, the but require domestic bank guarantee. GSF now thawed warranty issues can be resolved before the bank does not agree to the guarantees which Suntech bankruptcy crisis. Another $ 285 million will be converted into stock.
With the convertible bond crisis is resolved, Suntech will temporarily survive the bankruptcy crisis. Analysts said, it presumably Zhengrong Shi "blow" is not small, indicating that its further reduce the influence of Suntech.
From Yahoo: "if true, those numbers about half in cash and half in stock seem to be fairly inline with the market expectations based on bond price values and the put options betting on dilution. I thought so."
ReplyDeleteIts a good question, the holdouts could still reject this offer right? They could then file bankruptcy?
ReplyDeleteIf this deal did go through, how do you see it impacting stock price?
If it is even true, there will certainly be holdouts. They would have to budget for that.
ReplyDeleteIf there is actually a bondholder agreement, it's with the largest holders only, and they would have to plan on paying the smaller holdouts.
I see the stock price getting crushed from huge dilution. I don't think the big bondholders would agree unless they got more than half the equity.
The current EV through the stock is $470 million. If there was $285 million in new debt then it seems like there wouldn't really be any room for existing equity and claim with a straight face there's $285 million in new stock.
Also, one of the allegedly stated purposes is to dilute Shi. And I don't know why the bondholders would agree to let existing equity keep anything if they are taking a haircut.
Keep in mind - this could always be a lie/rumor to get people to buy the bonds.
ReplyDeleteAre they claiming that the new debt would have Chinese bank guarantee?
ReplyDeleteWeird. I didn't really imagine a deal with no cash component.
Odd that there is no sourcing. You'd expect this to be under wraps.