Bankruptcy winding-up proceedings by a small group of Suntech Power Holdings' disgruntled bondholders under US chapter 7 rules could be dismissed in the New York courts and reinstated under chapter 15 rules should Suntech’s latest petition be accepted.
Suntech Power Holdings said that it gained agreement from certain bondholders at a meeting arranged by its joint provisional liquidators (JPLs) in the Cayman Islands around a Restructuring Support Agreement (RSA).
The chapter 15 petition, according to the RSA would need to be presented to the US courts by February 21, 2014.
David Walker, one of the court appointed JPLs, said: “We are pleased to have been able to work with all parties to bring this agreement to fruition. Finding common ground and alignment among each of the company, its large creditors, its small creditors, and ourselves as the court appointed restructuring professionals represents tremendous progress. This agreement hopefully allows us to continue to proceed with the company's Cayman Islands restructuring to preserve value in the interests of all stakeholders.”
Suntech Power Holdings' manufacturing operations in China have already been sold to Shunfeng Photovoltaics via courts in Wuxi, China. It remians unclear what total assets the firm may have that could see the company able to restructure operations under chapter 15 proceedings, without a major 'haircut' taken by bondholders.
