(Updates with approval for bankruptcy loan in the fourth paragraph.)
Sept. 7 (Bloomberg) -- Solyndra LLC, the bankrupt solar- panel maker, may have two bidders for a plant that was financed partly with loan guarantees from the U.S. government, the company’s chief financial officer said.
A large group from one bidder will come to the company’s Fremont, California, factory and headquarters next week, W.G. Stover said today at the start of Solyndra’s bankruptcy in Wilmington, Delaware.
The company, whose $535 million federal loan guarantee was criticized by Republicans, filed bankruptcy yesterday with a plan to either sell its 8-month-old factory within four weeks, or liquidate the specialized equipment used to manufacture its solar panels.
U.S. Bankruptcy Judge Mary Walrath gave Solyndra interim permission to borrow as much as $4 million and spend about $3 million in cash to pay a warehouse debt while it seeks a buyer.
The U.S. Energy Department is concerned that the potential buyer may buy and move the equipment and technology out of the country, U.S. Justice Department attorney Matthew Troy said in court.
Under the Energy Department loan, the “assets have to be used and operated in the U.S.,” Troy said.
Solyndra shut down on Aug. 31, firing about 1,000 of its more than 1,100 employees.
The company owed lenders $783.8 million, including $527.8 million to the U.S. government, and held assets valued at $859 million as of Jan. 1, according to court papers.
Solyndra said it failed because it couldn’t compete with foreign manufacturers funded by their governments. Those factories produced an oversupply of panels at low prices and offered buyers lengthy payment terms.
The company makes cylindrical solar panels which are different from the flat panels that are standard in the industry. Because its product is unique, Solyndra had to design its own manufacturing equipment, Stover said.
Stover said it would be difficult for a foreign buyer to move the equipment overseas.
“The cost of moving assets would necessarily increase their investment by an enormous amount,” Stover said.
Stover didn’t identify the potential buyers.
The company’s factory opened in January and was built with the Energy Department loan and private financing. The company has about $3 million of that private financing left in a special account that once held $198 million, according to court papers.
In February, Solyndra and its lenders reorganized the company’s debts, putting the U.S. loan behind $69.3 million owed to other lenders, including an affiliate of Solyndra’s biggest shareholder, Argonaut Ventures.
That debt may be fully repaid as part of the bankruptcy, company attorney Maxim B. Litvak said in court. He told Walrath he didn’t know whether the company had determined if the Energy Department loan can be repaid.
The case is In re Solyndra LLC 11-12799, U.S. Bankruptcy Court, District of Delaware (Wilmington).
--Editors: Stephen Farr, Glenn Holdcraft
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