Suntech Power Holdings announced it had reached an 'understanding' with its creditors to allow it to convert debt into equity as well as the introduction of a new strategic investor. A few months back, Suntech's main unit had filed for bankruptcy and had defaulted on its loans.
The company is projecting that the new restructuring agreement would be formalized 'in the next week or so' according to a filing done by the Wuxi, China based technology company. Once the same has been formalized, the company said it would immediately prepare for recapitalization to strengthen its balance sheet.
The restructuring of its debt is being supevised by its Clearwater Capital Partners with Spinnaker Capital Ltd. The two would manage the debt for equity swap as well as the introduction of a new investor who would offer funds through the purchase of new shares.
According to Suntech President Zhou Weiping, through a statement, "The restructuring will allow us to cut our costs and optimize our margins and production. These measures wil put us in a better and stronger position to serve our current and future customers in China, Japan, the EU, USA and around the world."
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