This morning SunEdison filed a form with financial regulators which reveals details of its financial situation and discussions with loan holders regarding a potential restructuring. The company made it clear that these talks are ongoing and that there is no guarantee of being granted the necessary cash for it to restructure.
The companys 8-K filing comes only a day after SunEdison revealed the results of an internal audit, which found no evidence of material mis-statements or fraud, but instead an overly optimistic culture and a lack of financial controls.
As previously reported by pv magazine, SunEdison entered into debtor-in-possession talks with first- and second-lien lenders on March 17. Under a debtor-in-possession process, these lenders would steer the companys restructuring.
The talks were confidential, but SunEdison also agreed to file the information found in todays 8-K, which includes an overview of what it will need to survive over the next six to nine months.
According to the filing, the company was scheduled to enter a state of negative free cash balance earlier this month, and hit a low of -$260 million in free cash in late June. Through the talks SunEdison is seeking $310 million in interim financing, which it planned to secure with all of the currently pledged projects under existing loans, as well as unencumbered assets, assets of its residential services business, and real estate.
Under this scenario, the company would bounce back to around $250 million in free cash by the end of the year.
SunEdison remains in a precarious position. Bloomberg reports that the company faces default on $1.4 billion in loans and credit facilities, and notes that it failed to make an interest payment on bonds maturing in 2018.
SunEdison has also not yet filed Q4 results, and had previously stated that it was waiting for the results of the audit committee.
Todays 8-K did provide some detail regarding the companys Q1 position, noting that as of March 16 it expected $316 million in cash inflows versus $273 million in outflows. However only $153 million of those inflows had been secured, whereas the others were identified as at risk.