According to the Wall Street Journal, Suntech is now being forced into involuntary bankruptcy in the U.S. The U.S. bondholders filed a petition on Monday in a New York court. The petition is being led by Trondheim Capital LLC. The bondholders in the U.S. hold $578,230.68 in Suntech bonds.This gives them enough leeway to try and place Suntech into Chapter 7 bankruptcy code for liquidation.
Suntech had defaulted on a $541 million convertible note earlier this year. The company now has three weeks to respond to the petition.
Last week it was reported that a consortium of the Wuxi local government and cell and module manufacturer Jiangsu Shunfeng was bidding for the company's insolvent Wuxi manufacturing unit with the proposal to restructure the main Chinese unit. The Wall Street Journal additionally reports that some analysts believe that U.S. creditors probably wont see any proceeds from the sale until Chinese creditors are paid.
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