Wednesday, November 13, 2013

Suntech's Joint Provisional Liquidators Don't Want to Dance the Suntech Shuffle Step?

Suntech just released this 6-k.

On November 11, 2013, PricewaterhouseCoopers, the restructuring professionals appointed as a result of the grant of the Company’s application for a provisional liquidation by the Grand Court of the Cayman Islands, issued the following press release.


Hong Kong, 11 November, 2013 - On 7 November 2013, the Grand Court of the Cayman Islands appointed Mr David Walker and Mr Ian Stokoe of PricewaterhouseCoopers as joint provisional liquidators (the “JPLs”) of Suntech Power Holdings Co., Ltd (“Suntech Power”), a company incorporated in the Cayman Islands. The JPLs intend to work with the Suntech Power Board and its various stakeholders to attempt to restructure Suntech Power and its affiliated group companies (the “Group”).

We refer to Suntech Power’s Form 6-K Filing dated 19 July 2013 which disclosed certain transfers and disposals of the shares of Suntech Power Japan Corporation (“Suntech Japan”) and Suntech Power Investment Pte., Ltd. (“Suntech Singapore”) to Wuxi Suntech Power Co., Ltd (“Wuxi Suntech”) purportedly made in connection with intragroup debt restructuring (the “Purported Share Disposals”).

We hereby put all relevant parties on notice that the JPLs will investigate and pursue the Group’s rights to the fullest extent in respect of the Purported Share Disposals. Both Suntech Japan and Suntech Singapore were owned by Power Solar System Co., Ltd (“PSS”) and PSS is an immediate subsidiary of Suntech Power. PSS may be insolvent under the laws of the British Virgin Islands (“BVI”), the jurisdiction in which it is incorporated. As such, the Purported Share Disposals undertaken by PSS early this year may be voidable under BVI Law.

The JPLs are also aware of the Hong Kong Stock Exchange announcement made by Shunfeng Photovoltaic International Ltd on 1 November 2013 in relation to its proposed purchase of the entire equity interest of Wuxi Suntech by its subsidiary Jiangsu Shunfeng Photovoltaic Technology Co., Ltd. PSS is the 100% shareholder of Wuxi Suntech and any transfer or disposal of Wuxi Suntech’s shares requires the prior written agreement and consent of PSS. Suntech Power has instructed the directors of PSS that they are NOT authorised (in any way, whether directly or indirectly) to transfer or otherwise dispose of (in any way) any assets of PSS without the prior written approval of the JPLs. This includes any transfer or disposal of the shares of Wuxi Suntech. As of today’s date, the JPLs have not given their approval to any transfer or disposal of the shares of Wuxi Suntech to Jiangsu Shunfeng Photovoltaic Technology Co., Ltd or any other company or entity.

The JPLs reserve all the rights against any person or entity who may have participated in or facilitated (in any way) any transfers or disposals of the shares of Suntech Japan, Suntech Singapore and/or Wuxi Suntech referred to herein and any potential subsequent transfer of those shares, including the proposed purchase of the entire equity interest of Wuxi Suntech by Jiangsu Shunfeng Photovoltaic Technology Co., Ltd.”


Anonymous said...

There's not much the provisional liquidators can do, aside from "investigate."

The equity transfer has already been completed and the shares are controlled by the Wuxi court appointed administrator now.

Additionally, the bondholders notes are structurally subordinate to the bank loans under Chinese law, so there is no recourse STPFQ can take to re-claim assets in China (even if it won judgement rulings in BVI or Cayman).

Anonymous said...

Right... Suntech Power Holdings Co, Ltd is only going to get shares, not assets, back from China if they win these claims.

Wuxi probably wanted to dilute the convertible bondholders to <5%.

I wonder if the Chinese banks will sue Suntech Holdings for it's downstream debt guarantees in China.

Anonymous said...

It's pretty much a given that Wuxi and the majority bondholders won't reach an agreement to restructure the company.

Opium War said...

It looks like the big bondholders decided to blow up the Shunfeng deal today.

Or else PWC is more independent than we thought.

Anonymous said...

The deal between wuxi suntech (administrator) and a shunfeng subsidiary--both mainland companies in China--will close if the wuxi court and hong kong shareholders approve it.

If the deal does not close, then the wuxi administrator will be required to liquidate all of suntech's assets in china.

A layer at o'melveny & myers (the law firm representing suntech in the chapter 7 proceedings) said that "under chinese law, the bondholders do not have recourse to suntech's onshore assets" last week:

Anonymous said...

"Chinese companies cannot guarantee offshore bonds. Instead notes are typically issued from a Cayman or BVI wholly-owned foreign entity. While investors have recourse against an issuer’s assets outside China, it is unlikely that international bondholders have any say in an onshore bankruptcy process."

All of suntech's assets are in china except for gsf

Anonymous said...

Based on this it is apparent there's not much the JPLs can really do; Suntech spokesman noted sale of Wuxy Assets would likely be finalized in next few days (per below noted article)... seems Suntech just bought themselves enough time to finalize the Wuxi sale pre-official bankruptcy of the Holding Co, & therefore could avoid some legal issues.
Also, they transfered the shares of other subsidiaries prior to Holdco liquidation proceedings... and in any case Bonds are subordinated to other creditors, plus assets are in China... equity holders are subordinated to bonds... no huge new info here
So seems the Suntech controlling group bought enough time to do the Wuxi sale prior to Holdco Bankruptcy & potential larger legal questionings of the dealings.
Seems the JPLs are doing what they should officially do given the release, but this also seems like an attempt to save face in a way, & helps them avoid getting sued later on.
If Wuxi sale finalizes; more legal issues to continue, but Holdco remains with basically nothing except the GSF & SPI; if Shunfeng deal falls appart for some reason, Holdco still gets nothing given Chinese assets liquidate in China (probably for less than Shunfeng offered-?-); Guolian probably walks away; so lower chances for any recovery at all for Bondholders, & so even less for current equity holders, in my view...
Why was this news seen as a positive?
"According to a Suntech Power Holdings representative, contacted by PV Tech, the Wuxi court appointed administrators of Wuxi Suntech’s restructuring are expected to finalise the sale of the company to Jiangsu Shunfeng over the next few days or into next week."

Anonymous said...

Some of the assets that JPL referred to were domiciled in Chinese subs and some were not.

Suntech had subs in Korea, and Australia that were subs of the Singapore subsidiary (which in turn was 100% owned by the BVI sub of the Holding Co.) and a standalone sub in Japan (owned by the BVI sub). We don’t know what assets were in these subs, but whatever was in them and the Singapore sub itself were clearly property of the Holdco and were (it appears) summarily “donated” to Suntech Wuxi without a dime of compensation. The Singapore sub had several subs domiciled in the PRC including the Rietech wafer fab sub.

Given that the asset stripping transaction happened when the company was in default and had had its debt accelerated, the odds of that transaction passing muster at the end of the day seem slim. I don’t know Cayman’s law, but that deal would be looked at with extreme prejudice in US courts. The Chinese domiciled subs of the Singapore sub are probably beyond the reach of the JPL if some of the discussions of Chinese bankruptcy law that have been referenced on this blog are accurate. (That said, this is effectively a test case of the Chinese bankruptcy system with regard to how external creditors are treated. If their rights and concerns are completely stuffed by the Chinese courts, the cost of overseas capital for Chinese companies is going to go up as loss upon default estimates will increase. Maybe they don’t care and think they don’t need overseas credit investors, but that is a pretty shortsighted view if you have aspirations to be a major economic power.)

It is also worth noting that the major owners of the Holdco bonds (the guys that signed the standstill agreements) referenced this asset stripping (which occurred in July) from the Holdco controlled entities to Wuxi Suntech in the Restructuring Framework Agreement (RFA) that they signed with the company in September. In the enumerated conditions to the ultimate restructuring of the Holdco described in the RFA, the following passage was included: “The Company acknowledges that the [bondholders group] has expressed serious concerns regarding the transfers of Suntech Power Japan Corporation and Suntech Power Investment Pte. Ltd. [Singapore sub] to Wuxi Suntech and that, on or before the Closing, these concerns are to be reversed or otherwise addressed in a manner satisfactory to both the [bondholder group], in its sole discretion, and the Company.” So the Cayman’s court will see that the bondholders objected to this transfer at the time it was made and the company acknowledged a need to address it as part of a holistic restructuring.

It is also worth noting that Shunfeng appears nervous about the potential of the JPL to screw up its deal for Wuxi Suntech. In a filing it made today, it reiterated the previously stated requirement that Shunfeng must pay the balance due for the Wuxi Suntech assets within 30 days of the date the Wuxi Intermediate People’s Court approves the transaction (that has still not happened). However, in today’s filing, it added that Shunfeng’s founder, Mr. Cheng would personally front the money for the purchase, with no recourse on his part to Shunfeng for the funds, in order to close the transaction before the Shunfeng shareholders vote to approve it. So it would appear that Mr. Cheng feels he got a pretty good deal on the assets and is perhaps worried about the deal getting undone in some kind of legal challenge. Shunfeng also referenced the PWC’s appointment as JPL of the Holdco and added “The Company [Shunfeng] cannot guarantee that no interested parties may take steps to object to the Restructuring Plan [of Wuxi Suntech] including the making of an application to the Wuxi Intermediate People’s Court to object to the approval of the Restructuring Plan.”

I don’t think the fat lady has sung yet, at least with regard to the disposition of the Japanese, Singaporean, Australian and Korean assets and subs. Stay tuned.

Anonymous said...

Further to the last comment, Shunfeng issued another release which disclosed that they had received a letter from the JPL stating that PSS (the BVI parent of the Suntech Japanese and Singapore subs) "may be insolvent and the Transfers [of the Japanese and Singapore subs] may be voidable under the British Virgin Islands law. In addition, the JPL have instructed the directors of PSS that they are not authorized to transfer or dispose of the equity interests of Wuxi Suntech. As of this date the JPL have not given their approval to any transfer or disposal of the equity interests of Wuxi Suntech to [Shunfeng or any other company or entity."

Shunfeng claimed that any objection by the JPL of the Wuxi Suntech restructuring should be raised with the Wuxi Intermediate People's Court.

As I said above, I don't think the JPL will have a lot of success clawing back assets that are domiciled in the PRC, but the assets that are outside China are another matter altogether.

Here's a prediction: the JPL will find that PSS is insolvent. Anyone know who the directors of PSS are?

Wuxi said...

I think New York is going to take over and appoint a trustee.

It will set an important precedent that these Chinese holdco deals will be liquidated in the U.S. when they go bad. That's what the NY bar, professionals, and creditors want.

Anonymous said...

Thank you very much for your comments. Is there any link or anywhere were one could read the referenced September RFA?

It still seems very strange that the major bondholders would be onboard with the Wuxi assets sale & deal with Shunfeng, depite knowing about this, and stating that in the RFA (could reason for stating that & then not making sure to act upon it be part of protecting themselves from potential future legal action against them?). These bondholder group allowed the Wuxi Creditors vote & did not seem to support other measures like the ones from Trondheim etc to try to block it or at least to institute a more proper regulatory overview like formal bankruptcy/liquidation in the US/CI etc as is now ongoing (if they weren't in favor of the deal, why not accelerate current proceedings & try to block it earlier?). So in a way it feels like they have been somewhat complacent with the Wuxi & Shunfeng dealings... or that they have concluded the Shunfeng deal (& later potential stake sale to Guolian) is the best option available (note that apparently Shunfeng beat Guolian's bid for the assets -& Guolian could pressumably have better insights into their value since they've been involved in managing Wuxi Suntech since mid March).

Very interesting to follow and definitely a great learning experience, but at the end of the day, the Wuxi Creditors still own much of the debt, on which they had accepted significant haircuts on the Shunfeng deal (& it's not guaranteed they'd accept those again if the deal broke), given the local socioeconomic benefits from Shunfeng restarting the non-obsolete lines, investing more within 2yrs to upgrade, etc. Suntech seems to be cash flow & balance sheet insolvent as per the Cayman Islands filing; if the Shunfeng deal falls appart, and the assets are liquidated and in best case scenario the Administrator or the JPLs manage to get more money from liquidating these, versus the Shunfeng deal + plus the Guolian potential investment (which seems could also fall appart if Shunfeng sale is not completed), then this still would mean it's mostly the current creditors (Chinese banks, suppliers, etc & then potentially international creditors) who would simply receive more than what they had accepted from Shunfeng (and that is still a very large unknown versus a definite deal with Shunfeng).

Anonymous said...

Bondholders are still subordinated and seem to have no claim on China based assets. So, hopefully in the end, under whatever scenario that ends up materializing, there is something left to pay back to the bondholders (or to convert them into that). SPI & GSF assets seem would have minimal value, if any, as I understood it from the filing for liquidation in the Cayman Islands (plus you get continued Fraud risk & investigations ongoing on GSF, the liabilities, etc)... I still have a very hard time picturing a scenario where the Bondholders, if they ever get in the position of getting anything tangible back, would prefer to convert into equity, & in that case would not dilute as much as they can from the current equity (much of which can likely still be owned by Dr Shi), in case they accept any conversion into equity. I think current equity should have been cancelled months ago, and a real bankruptcy &/or restructuring process have started. But the soap opera has dragged on and on.

Despite the apparent positive reaction on today's pink sheets of STPFQ, be it on trading issues due to so many puts being in the money, plus the implied potential ray of light from the JPLs announcement, if Suntech is able to get more money for its assets, current equity holders seem still way way out on the potential sharing of any value, if any ever materializes.

In any case, as per Shunfeng's announcement on the JPL's letter to them, Shunfeng sticks to saying they understand that the Administrator is the one in charge of the Wuxi restructuring by Wuxi's court, and that the Wuxi restructuring is according to PRC bankruptcy law, subject to the Wuxi Intermedite People's Court sanctioning, & so that any objection by the JPL's should be directed to the Administrator & the Wuxi Court. In the mean time they are rushing to get this done. And while in the long run this seems it could continue being a great case on international & Chinese bankruptcy litigation, if the assets sale gets approved by Wuxi court, then that's it, bondhodlers are definitely left with SPI, GSF, & the Americas sales businesses; if the Shunfeng deal falls off, then likely Guolian deal also falls appart, much more uncertainty would come, including the potential for immediate liquidation after the CH7 hearing in NY on 12/12, or liquidation approved by the JPLs which might or might not get more or less money for the assets, which after everyone gets paid, it still seems bondholders could end up still getting very little of. And here I htink back to why did the Bondholder Group endorse/allow the Wuxi vote and everything else to happen without advocating more strongly for alternatives.

Anonymous said...

The September RFA was part of the Cayman's filing. It was passed to me by another investor.

I think you have to look at the transfer of assets to Wuxi as part of a bigger deal where Guolian was promising to inject cash and other assets up at the holding company level. We don't know what is in the Singapore and Japanese subs (other than Rietech which appears to have a fair amount of value).

Moving assets up to holding company level, particularly unencumbered assets and ones that could generate cash (those are suppositions by me, not based on any knowledge) would add a lot of value to the bonds. We don't have enough info to really be able to step into the shoes of the bondholders, perhaps we'll have more as the BK process proceeds in NY or the Caymans. One measure of the liquidity status of the Holdco is a document filed in connection with the RFA that says the Holdco was trying to raise $5-10MM just to be able to pursue the restructuring. Things must have been fairly desperate.

I doubt the Holdco equity has any value other than possibly a token amount as a political gesture so the Chinese can say it wasn't wiped out. Not much to bet on.

I don't think the bondholders are going to end up getting a lot back either at the end of the day, but they should be able to stop the stripping of the Japanese, Korean and Singapore domiciled assets. Unlike China, those places generally have rule of law and if the JPL can show the share or title transfer on stock or assets was invalid, then the Holdco should be able to reclaim title to the assets regardless of what the Wuxi court has to say. Unless China is going to invade to secure a bunch of likely heavily depreciated assets, Wuxi won't have any say over what goes on in another country. It's not like China has some well respected bankruptcy process that other countries would defer to. Quite the opposite in fact.

Anonymous said...

The legal analysis is spot on, but I would like to focus your attention on what matters most: the negotiations taking place between Wuxi and the majority bondholders.

It is quite clear that the majority bondholder appointed Chairman are his JPL friends are trying to gain leverage in a situation where the bondholders seemingly have little (since most of Suntech's operating assets are in China and all foreign creditor claims are structurally subordinate to the Chinese creditor claims on Suntech's assets in China).

Wuxi does not want to loose tax revenues and jobs from solar businesses and suppliers; they are bending over backwards to avoid liquidating Wuxi STP in the Chinese bankruptcy proceedings.

The majority bondholders want to control the following assets:
* Cayman holding co
* P4 manufacturing plant in China
* IP (held by the Singapore intermediate subsidiary)
* R&D (Chinese subsidiaries held by the Singapore intermediate subsidiary)
* All non-China sales contracts (the main assets held by foreign subsidiaries)
* JV (likely a revenue and/or profit split) with Shunfeng

In my view, the majority bondholders are proposing the following to the Wuxi administrator & Wuxi Guolian: "if you want us to transfer the Wuxi STP shares to Shunfeng's PRC subsidiary, then make the $150m equity infusion and agree to the terms sheet above with us."

Should Wuxi reject the majority bondholders' terms (e.g. by taking over Wuxi STP and selling it to Shunfeng), then best alternative for the majority bondholders would be to pursue a cash settlement by threatening expensive litigation in BVI, Cayman, China, HK, Japan, USA, etc, and paying lawyers contingency fees.

While considering my view, keep in mind that the JPL announcement took place immediately after the PRC creditors paved a road for Wuxi STP to exit bankruptcy proceedings in China.

In sum, the majority bondholders are trying to gain an upper hand now that Wuxi has more to loose should either the Shunfeng deal collapse, or the holding company be wound up and liquidated by a Cayman court before the Shunfeng deal closes.

Of course, both Wuxi and the majority bondholder may wind up in a pickle if the minority bondholders were win either a chapter 7 bankruptcy ruling in NY, or use their US judgement rulings to wind up the holding company in Cayman court.

Since the Chapter 7 hearing is scheduled for December 12 and Wuxi Suntech is scheduled to exit bankruptcy by December 16, a fuller and clear picture should materialize over the next few weeks.

What path will each creditor take? Who will cross the finish line first? And how long will it take?

Anonymous said...

That makes some sense. However, seems would be a huge risk for Bondholders & everyone to turn around and try to change the deal once it has been made. If the Shunfeng deal is changed then Shunfeng likely walks away; they are paying 3B yuan for everything already included in the deal; changing the deal so significantly likely means they lose interest, & it's unlikely they'd double the bid (the bids in theory should basically indicate market value for all assets, including manufacturing, IP, R&D, employees, etc. and Shunfeng was the highest bidder, on top of Guolian who pressumably should have better knowledge of Suntech's operations and value). So seems a huge risk from the bondholders to turn from their earlier deal, and to jeopardize the 3B yuan Shunfeng offer, plus the Guolian proposed $150m cash injection, in favor of a potential value of the assets in liquidation (which Shunfeng &/or others could then buy at even potentially cheaper prices; if the Holdco is gone, and everything is being liquidated, then why would Wuxi care in keeping the current Holdco/subsidiaries? Couldn't they help finance the purchase of the liquidated assets, or potenitally reach a deal w Shunfeng to start fresh with newer, much more cost competitive equipment?). It just seems that if this is what the Bondholder Group wants, then why not join Trondheim and others earlier & speed up the liquidations?

Separately, the transfer of equity from the other subsidiaries into Wuxi Suntech happened while the Holdco was not under the bankruptcy or liquidation proceedings, so there's likely have a point to defend; plus apparently it wasalso part of transfer of equity from intercompany debt payments done (?). Wuxi Suntech has been under control and authority of Wuxi Administrator & Wuxi court; they seem to have the last words, plus they still control the assets. The Financial Times this morning quoted an officer from the Wuxi Intermediate Court saying "It is already settled"...

In any case, this soap opera seems will be over either within the next few hours, early next week, or by mid December. A great learning experience on multiple fronts.

MrGotham said...

Anon 11/14 11:30PM

I agree with your analysis for the most part about the bondholders trying to get leverage.

With regard to the P4 plant, according to the Suntech press release about the Japanese subsidiary, the P4 plant would be a 100% owned sub of Wuxi Industrial Development Group and entirely outside of the Guolian family of entities. Perhaps there is a thought to merge those two groups at a later date, but this org chart of who owned what between Shunfeng, Guolian and Wuxi Ind. Dev. was very detailed. Perhaps P4 is the among the assets that they are planning to put into the Holdco along with the $150MM cash.

I agree with you that the bondholders are trying to get leverage to get Guolian to put the cash into the Holdco. It is worth remembering that the announcement of that plan was a very flimsy commitment and sounded like it was a long way from being done.

With regard to the timing of the various court actions, I think the Shunfeng announcement yesterday that Mr. Cheng is going to front the cash for payment to Wuxi is very significant. This is essentially a rush to finish the deal before the other legal processes can run their course.

According to this story, it looks like Wuxi is going to close the sale to Shunfeng in the next few days:

"According to a Suntech Power Holdings representative, contacted by PV Tech, the Wuxi court appointed administrators of Wuxi Suntech’s restructuring are expected to finalise the sale of the company to Jiangsu Shunfeng over the next few days or into next week"

MrGotham said...

Anon 11/15 7:38

The bondholders have more leverage than you think they do and don't have a lot at risk if the Wuxi deal blows up.

Consider Shunfeng's announcement yesterday that Mr. Cheng is going to personally front the money to complete the purchase of the Wuxi assets in the next 30 days. He's doing this with no recourse to Shunfeng for that cash and with no assurance that the deal will be approved by the shareholders or that Shunfeng will find the financing to pay him back. If he is willing to take this kind of risk, he must think he got a pretty good deal. If that is the case, do you think he might be willing to pay some more to the Holdco to get past this issue of stripping the Singapore and Japanese subsidiaries from the Holdco without compensation?

Moreover, remember that none of the money that Shunfeng is putting up will go to the Holdco. All of it is going to the creditors of Wuxi Suntech which are primarily Chinese banks and trade suppliers, so the bondholders aren't much worse off if that deal doesn't happen or gets delayed. The reason for them to support such a deal is that it is presumably part of a quid pro quo with Guolian to put $150MM into the Holdco, along with other operating assets, that would insure there is some value for the bondholders at the end of the day. However, that "deal" is a statement of intent, not a definitive agreement. What happens to the bondholders leverage to get it done after the Wuxi deal closes?

As to the state of the Holdco at the time the assets were stripped, the fact that it had not technically filed for reorg is going to be a distinction without a difference to a BK judge I believe. The company was in default, one of the lenders had accelerated their loan (IFC), and it was clear from all indications that the company was in a cash crisis. In addition, there is a document signed by Guolian acknowledging that the bondholders did not think the transaction was kosher and that there needed to be compensation for those assets as part of the holistic restructuring of the Holding co and the rest of Suntech. The action by the JPL suggests that the bondholders feel that Guolian and the Wuxi liquidator have reneged on that agreement.

Finally, to repeat a point I made earlier, the Wuxi court has no jurisdiction over assets domiciled in Japan, Korea, Australia or Singapore, and no court in those countries is going to be impressed by their insistence that "the deal is settled". In addition, they all know that the rule of law in China is a joke. If the JPL is at all worth the egregious fees they are charging, they have already filed for an injunction to block the transfer of title to the assets or shares of the subsidiaries in those countries.

This thing is a long way from "settled". It still won't matter for the stock, but it will have an impact on the recovery for the bonds.

Anonymous said...

Thanks for sharing your perspective, @MrGotham. I agree with your analysis, but I think it points to a bearish, rather than bullish, outcome for bondholders. Let's assume the PSS share disposal is void under BVI law. PSS still has no standing to bring a lawsuit in China since the company is not a legal entity in China. All the Wuxi Suntech and Suntech Power Investment Ltd assets are located in China. Essentially, there is no way for PSS to reclaim assets in China (even in the event a void disposal of assets was made); this one of the many reasons why China forbids any company formed in China from either issuing or guaranteeing debt outside of mainland China. It would be a good idea for you to give consideration to selling any notes you hold. It is very clear that bondholders have absolutely zero protection if the holding company is unable to restructure before the filing of either a chapter 11, or a chapter 15 and a winding up petition.

Anonymous said...

I agree that they don't have any standing to claw back assets in PRC, but there was never going to be enough value there to cover the debt. However, the Singapore sub holds the patents, and I doubt Mr. Cheng wants the PRC plants without those, that is some thing the bondhoders can negotiate with. BTW I don't own the bonds, just short the stock. Mr. Gotham

Anonymous said...

The Chinese news outlets reported that Wuxi Guolian rescinded it's LOI today and will make no future investment in STPFQ.

It is pretty much a given that the STPFQ restructuring will take place inside a courtroom now.

STPFQ only had $2,400,000 unrestricted cash as of last September (according to the provisional liquidation filing).

STPFQ needs at least $5 million to retain an investment bank to carry out a debt for equity swap.

STPFQ would also need about a hundred million USD to settle with bondholders who are unwilling to participate in a swap for it to be successfully conducted.

Bondholders will be very lucky to recover anything after STPFQ pays off JPL and legal expenses.

Opium War said...

Link? We didn't hear anything about Guolian rescinding their "offer", not that we believed it was real in the first place.

Anonymous said...

Just googled, there's nothing about Guolian rescinding the $150 to holdco

Anonymous said...

Read "Suntech Battle," which was published by the Economic Observer on Nov 12th, but updated on the 16th,

Here's a literal translation of the 2nd paragraph:"Binding approval of Suntech's bankruptcy reorganization plan," "Wuxi government once again acted as a white knight," "Now Wuxi Guolian will withdraw from Suntech," "It was working with Suntech's parent company to defend Suntech against war," "Only hope for Suntech left with is securing financing in the United States."

CP said...

Is that really what it says? I don't get that impression from google translate.

Anonymous said...

The quote appears be the same as that put on the Yahoo message boards. A friend translated it as follows:

"After resolving Wuxi Suntech's bankruptcy reorganization plan, the city government of Wuxi is playing white knight again, removing Wuxi Guolian from Wuxi Suntech and placing itself in the battle to protect Wuxi Suntech's parent Suntech Power, in the hopes of retaining a financing platform for Suntech in the US..

However, foreign creditors not only demanded that Suntech Power enter into forced bankruptcy procedures in the US, but also demanded "a thorough inspection of Suntech Power's finances and transaction history along with explanations for any defects therein."

Doesn't sound at all like they've withdrawn their LOI.

Anonymous said...

Ok. So, if someone was calling for the Fat Lady, if she's not yet singing, she sure is warming up... Shunfeng "is pleased to announce that the Restructuring Plan has been approved by the Wuxi Intermediate People’s Court on 15 November 2013 (the ‘‘Approval Date’’)."... "All of the equity interests of Wuxi Suntech shall be transferred to Jiangsu Shunfeng or parties designated by Jiangsu Shunfeng at nil consideration."
“The Restructuring Plan is binding upon the creditors of Wuxi Suntech, the existing equity interests holder of Wuxi Suntech, Wuxi Suntech, the Administrator and Jiangsu Shunfeng. The Restructuring Plan is to be implemented by Wuxi Suntech under the supervision of the Administrator”
JPL’s might try to say whatever they want etc, but what’s done is done, & China is China. Seems like that’s it.

Anonymous said...

Ok. So, if someone was calling for the Fat Lady, if she's not yet singing, she sure is warming up... Shunfeng "is pleased to announce that the Restructuring Plan has been approved by the Wuxi Intermediate People’s Court on 15 November 2013 (the ‘‘Approval Date’’)."... "All of the equity interests of Wuxi Suntech shall be transferred to Jiangsu Shunfeng or parties designated by Jiangsu Shunfeng at nil consideration."
“The Restructuring Plan is binding upon the creditors of Wuxi Suntech, the existing equity interests holder of Wuxi Suntech, Wuxi Suntech, the Administrator and Jiangsu Shunfeng. The Restructuring Plan is to be implemented by Wuxi Suntech under the supervision of the Administrator”
JPL’s might try to say whatever they want etc, but what’s done is done, & China is China. Seems like that’s it.

CP said...

Please move to the newest Suntech thread on the front page.

Anonymous said...

So, the big bondholders knew about the improper transfer of properties but did nothing about it until it was too late?

Anonymous said...

Shunfeng "is pleased to announce that the Restructuring Plan has been approved by the Wuxi Intermediate People’s Court on 15 November 2013