China-based LDK Solar has announced that due to a temporary cash-flow shortage, the firm was not able to make full payments to the holders of its 4.75% convertible senior notes due 2013 in an aggregate principal amount of US$23.793 million, plus interest, otherwise due and payable on their maturity date of April 15, 2013. The firm also announced further details of the sale of its subsidiary in Hefei, China.
LDK Solar stated that the firm has engaged in private and individual negotiations with two holders of such convertible notes in the aggregate principal amount of US$16.553 million, and reached settlement shortly before the maturity date through a partial payment in cash and effectively a loan facility to postpone the repayment of the remaining indebtedness.
The firm had informed The Bank of New York Mellon, as trustee for the holders of the convertible notes, of such nonpayment, and is ready and willing to discuss and reach a settlement for the remaining convertible notes, said LDK Solar.
LDK Solar also announced Anhui LDK New Energy, its subsidiary, signed an agreement to sell and transfer all its equity interest in its wholly owned subsidiary, LDK Solar High-Tech (Hefei), located in Hefei City in China, to Hefei High Tech Industrial Development Social Service Corporation, an affiliate of the Hefei City government. The total sale is approximately CNY120 million (US$19 million). LDK Solar expects to realize a net loss in the range of US$80-90 million for this transaction based on the firm's book value.
Previously, LDK Solar announced a purchase agreement in January 2013 with Shanghai Qianjiang Group, with its consummation subject to relevant governmental approvals. However, Shanghai Qianjiang Group failed to secure such government approvals by the expiration date of March 30, 2013, said LDK Solar.
