Centrosolar applies for creditor protection

German solar company Centrosolar Group AG today announced that it had filed for the opening of a protective shield to help the company implement more swiftly its restructuring process.

Due to slower-than-expected market recovery following overcapacity and the subsequent introduction of EU anti-dumping measures, Centrosolar has not been able to effectively address its debts in the manner in which they had hoped.

Instead, the company has seen its revenue for the year so far fall to just €85 million, down from €145 million at this point in 2012.

The management board and company directors believe that now is the right time to instigate a restructuring, and so have filed for creditor protection in an effort to stave off creditor’s calls while the company makes the requires changes.

In a press release issued by Centrosolar AG, the company state that "the parts of the company affected by the protective shield proceedings will – once the proceedings have been approved by the court – continue to be run by the current management board and directors. Business operation at the Hamburg, Wismar, Paderborn, Kempten and Munich sites will continue without restriction."

According to the statement, all other domestic and international subsidiaries (which include Renusol GmbH and Centrosolar America Inc.) will continue to operate as normal, and will be unaffected by the proceedings.

The protective shield phase, if granted, has a time limit of three months. During this period Centrosolar companies are permitted to do business as normal with the chief focus one of clearing debts and placing greater emphasis on the company’s profitable core areas.