Bloomberg News

Solon’s Non-German Units Are Spared From Solar Insolvency

December 16, 2011

(Updates with closing share drop in fourth paragraph.)

Dec. 15 (Bloomberg) -- Solon SE’s insolvency, the first of a publicly traded solar company in Germany, won’t affect its units in Italy, France and the U.S.

The insolvency is for now confined to the holding company and its German units with 532 of a total 800 employees, said Moeller PR, which represents the administrator Ruediger Wienberg of law firm HWW Wienberg Wilhelm. Wienberg will contact customers and suppliers to maintain production and order processing, it said. Wages are secured through February.

“We will use the next days to stabilize business operations,” Wienberg said in an e-mailed statement late yesterday. “We will then thoroughly analyze the company’s financial situation and check all available options.”

Talks between Solon, lenders and investors on extending a year-end deadline to repay a 275 million-euro ($358 million) loan to Deutsche Bank AG and other German banks failed Dec. 13, prompting the company to file for insolvency. The shares fell 26 percent today to 37 euro cents, giving it a market value of 6.4 million euros, after tumbling 46 percent yesterday.

The country’s solar manufacturers including Q-Cells SE and Conergy AG are reeling from rising foreign competition just as demand ebbs in Germany, the biggest photovoltaic market last year. Chinese companies have increased production capacity even after international prices slumped, tipping three U.S. solar developers including Solyndra LLC into bankruptcy this year.

--With assistance from Randall Hackley in Zurich. Editors: Amanda Jordan, Stephen Cunningham

To contact the reporter on this story: Stefan Nicola in Berlin at snicola2@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net


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