Debt-burdened Chinese wafer manufacturer LDK Solar today announced it has filed for the appointment of joint provisional liquidators in its Cayman Islands base to help it restructure offshore liabilities.
The appointment of liquidators if approved by the Grand Court of the Caymans would see LDK follow fallen giant and former Chinese rival Suntech‘s recent example.
In an announcement of the filing on its website today, LDK Solar was at pains to stress it has no plans to apply for a similar process in China and stated the Cayman Islands filing would not affect its manufacturing operations.
LDK has been negotiating with the holders of RMB1.7 billion (US$279 million) worth of 10% notes in the company who are awaiting an interest payment on the notes due since August 28.
In its latest statement, LDK referred to the ‘considerable progress’ made in the negotiations with creditors, which have seen the company obtain a string of short-term stays of execution since the interest payment became due.
LDK says it anticipates a favorable conclusion to the talks which will continue ‘over the next few days’ and added its group of Chinese lenders have expressed their support for the debt restructuring talks.
Bloomberg today reported that the talks concern two solutions tabled by LDK with its creditors in December, to convert the money due into stock or to settle for 20 cents in the dollar.