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Suntech reaches agreement to delay debt payment

The Associated Press

WUXI, China (AP) -- Suntech Power Holdings, one of the world's biggest solar panel manufacturers, said Friday that its bondholders have agreed to extend the due date of a payment they are owed until Aug. 30, the latest step in the struggling company's debt restructuring.

The new agreement means the company has more time to make the payment to bondholders. The bondholders, in return, will get to nominate two additional members to the company's board. They might also get their bond claims converted into company equity.

The China-based company was forced into bankruptcy court in March, after running short on cash. Solar panel makers have suffered huge losses recently, after overestimating demand for their products and plunging prices. Suntech, headquartered in Wuxi, China, also has been hurt by a revelation that a business partner faked $680 million in collateral for a loan Suntech had guaranteed.

In a news release Friday, the company said it would also work with the bondholders "to identify strategic and financial investors to bring in new capital to Suntech."

"We remain optimistic that a mutually acceptable consensual restructuring of the company is achievable," CEO David King said in a statement.

The company's shares fell 1 cent to close at $1.03.