Reports of SunEdison in debtor-in-possession talks, danger of bankruptcy


Despite the cancellation of its controversial acquisition of residential installer Vivint Solar earlier this month, SunEdison does not appear to be out of the woods. Today financial intelligence firm Debtwire reported that SunEdison has entered into debtor-in-possession talks with holders of US$725 million in second-lien loans, citing “two sources familiar with the matter”.

Debtwire analysts state that a SunEdison Chapter 11 bankruptcy filing is “likely on the horizon”. Although SunEdison has not filed Q4 financial reports, Debtwire estimates that the company had only $56 million in unsecured cash at the end of Q4 2015.

The talks allegedly have focused on providing SunEdison with $300 million in capital. The firm also states that the holders of SunEdison’s second-lien loan have hired the firm Akin Gump as legal counsel, and follow in the failure of out-of-court negotiations.

SunEdison held over $11 billion in debt at the end of Q3 2015, and has cited “material weaknesses in its internal controls over financial reporting” for the delays in its Q4 results. The company did not responded to pv magazine requests for confirmation of these talks by press time.

SunEdison stock slid 16% around noon when this news broke on multiple outlets, and is now at only 5% of the value it held last July.