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Having defaulted on a bond due to cash flow problems, struggling PV manufacturer, LDK Solar has sold its major crystalline solar cell production plant to an affiliate of the Hefei City government for a nominal US$19.4 million.
LDK Solar High-Tech (Hefei) Co., Ltd., located in Hefei City of Anhui Province in China had a solar cell manufacturing capacity of at least 2.2GW, which started production in early 2011 as part of LDK Solar’s strategy to become a fully-integrated module manufacturer rather than a wafer specialist.
LDK Solar has another smaller cell manufacturing facility Xinyu with a capacity of around 300MW per annum, according to previous company documentation.
Although the latest deal with Hefei High Tech Industrial Development Social Service Corporation provides much needed cash to the company, LDK Solar said in a statement that based on the book value of the facility it would report a net loss attributed to the sale of between US$80 – US$90 million.
The Hefei plant was said by management during its second quarter 2011 conference call to have been the main target for capital expenditure that year, which was said at the time to be in the region of US$700 million.
LDK Solar had previously struck a deal with Shanghai Qianjiang Group to purchase the Hefei solar cell facility. However, the company said that the buyer failed to secure government approvals by a March 30 deadline.