Employees let go as Solar Millennium insolvency proceedings begin

In a statement released today, the German solar company announced that the local court of Fürth in Germany initiated insolvency proceedings yesterday. Provisional liquidator, Volker Böhm of law firm Schultze und Braun, has been appointed insolvency administrator. "Upon the initiation of insolvency proceedings, Mr. Böhm assumes power of administration and disposal from the former company organs," explained the statement.

Despite the announcement, there is still hope that investors will come on board. "The insolvency administrator still sees takeover opportunities for the Flagsol GmbH subsidiary in Cologne and some of the Spanish power plant projects, particularly Arenales. Apparently investors are also interested in taking over Solar Millennium AG as a whole, although the prospects of success are highly uncertain in this respect." As such, the remaining staff at the company – around 40 – received a notice of termination, also yesterday.

The local court has appointed a creditors’ committee of inspection. The first meeting is scheduled to take place on May 15, 2012.

Solar Millennium filed for insolvency on December 21. It cited the postponement of its U.S. photovoltaic pipeline discussions with solarhybrid, which have since concluded, as the primary cause. Just a day later, it was announced that Böhm was appointed provisional liquidator by the Fürth District Court.

It was Böhm’s hope that investors could be found, which would be interested in either completely taking over the German solar company, or its individual elements. However, a particular challenge in the sales process was the heterogeneous structure of the company portfolio: Solar Millennium has around 60 companies and global company investments across the world. Additionally, its projects are jointly implemented with industrial partners, meaning that the sale or use of the projects have to be negotiated separately.

In between the various announcements, it also emerged that a German investment protection body had been commissioned with investigating whether Solar Millennium had broken financial laws. Financial authorities and attorneys started looking into Hannes Kuhn, the company’s chairman of the Supervisory Board and founder, who had recently stepped down.