The China-based photovoltaic manufacturer has announced that Fulai Investments Limited will buy 25 million of its shares for a purchase price of $1.03 per share an 8% discount to the 5-day average share price, says LDK.
According to a statement released, Fulai will pay LDK in two installments, worth $15 million and $10.75 million, in May and June, respectively. Under the agreement, Fulai, understood to be owned by a Hong Kong investment business, also holds the right to appoint two non-executive directors to the LDK Solar board.
In January, LDK and Fulai entered into a separate share agreement under which Fulai acquired 17 million newly issued ordinary shares for $31.11 million. Following the transaction, Fulai held a 12% stake in LDK. How much of a stake the company now possesses is not known, and LDK could not be contacted for further details.
In related news, just a day after LDK Solar defaulted on a $23 million convertible bond payment April 15 the manufacturer announced that an affiliate of the Hefei City government in China had agreed to purchase LDK subsidiary, LDK Solar High-Tech (Hefei) Co., Ltd for around $19.4 million.
Many believe LDK, which has suffered a number of financial setbacks in recent months, is likely to become the second major Chinese solar player to declare bankruptcy. An industry analyst based in Europe told pv magazine that had the company not been Chinese, it would already be bankrupt. However, due to a number of bailouts, it has managed to stay afloat thus far.