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RENEWABLES / CLIMATE CHANGE TRENDS
 
Vol. IX Issue. 9
Heavy debts set China solar makers up for consolidation

14 August 2012

August 14, 2012. As solar panel prices continue to march lower, Chinese solar companies are struggling with heavy debt loads, triggering expectations many will be forced to seek a new infusion of funds through takeovers or mergers. Suntech Power Holdings could be liable for hundreds of millions in new payments after it disclosed a potential fraud by a partner, while peers such as LDK Solar, JA Solar Holdings Co, Trina Solar and Yingli Green Energy Holding Co are also feeling pressure. With prices for solar panels barely covering the cost to build them, dozens of small Chinese solar companies are believed to have shut their doors, and equity investors have fled the sector, sending share prices of the U.S.-listed Chinese companies down more than 85 percent since early 2011. Most of the Chinese solar companies will be able to stay open only if government lenders continue to keep lines of credit open despite forecasts of several more quarters of red ink.

      
 
 
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