Struggling Chinese solar panel maker Yingli Green Energy Holding Co (英利綠色能源) is to receive about 3.3 billion yuan (US$508 million) in loans from a state bank and the government where it is based as it looks to pay off old debts and restructure operations, said a person familiar with the matter.
China Development Bank Corp (國家開發銀) is to lend 2.5 billion yuan to US-listed Yingli, while the government in the city of Baoding is to provide the remainder, according to the person, who asked not to be identified, because the discussions were private.
Yingli, once the world’s biggest solar manufacturer, had total debt of US$1.9 billion as of last year and its American Depository Receipts have fallen more than 80 percent in 12 months.
An oversupply has driven panel prices down about two-thirds since 2010, forcing some big Chinese producers, including Suntech Power Holdings Co (尚德電力) and LDK Solar Co Ltd (江西賽維), to file for bankruptcy after failing to repay debts.
The loans mark the most significant intervention by a state bank to help struggling solar companies. In 2012, LDK Solar, which in November last year announced a restructuring of its onshore operations, received local government help to pay off a portion of its debt.
Caixin magazine reported earlier that Yingli would get more than 2 billion yuan in loans from China Development Bank. As part of the move,
Yingli is to focus on its photovoltaic business, while other businesses and non-performing assets are to be sold or restructured, the person said.
China Cinda Asset Management Co (中國信達資產管理公司), a state-owned asset-management company, has been chosen to join the debt-restructuring effort, the person said.
Yingli had total debt of about US$1.9 billion at the end of the third quarter last year. The company has not reported a profit since the second quarter of 2011.
Two calls to the Baoding government’s news department went unanswered. China Development Bank did not respond to an e-mail request seeking comment. Yingli’s news department declined to comment.
Unit Baoding Tianwei Yingli New Energy Co still owes about 350 million yuan on 1 billion yuan of notes that were due on Oct. 13, last year. The company is in discussions with bondholders of 1.4 billion yuan of notes due in May.
Global solar installations are to grow by at least 20 percent this year compared with last year and Yingli is to focus on panel sales to speed up the turnover of capital as part of its efforts to repay debt, chief financial officer Wang Yiyu (王亦逾) said last month.
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