Suntech Power Holdings Co. (STP:US), the Chinese solar-cell maker whose main unit was pulled into bankruptcy proceedings in March, was sued by investors seeking $550,000 due on securities.
Trondheim Capital Partners LP and Michael Meixler filed the suit in New York State Supreme Court in Manhattan yesterday. They’re requesting a pretrial ruling ordering Wuxi, China-based Suntech to pay $550,000 in principal due on 3 percent 2013 convertible senior notes, plus interest, costs, expenses and legal fees, according to court filings.
Suntech defaulted on March 15 on its obligation to repay $575 million to holders of the notes, which were issued in March 2008 pursuant to a prospectus and registration statement (STP:US) filed with the U.S. Securities and Exchange Commission, according to a statement from attorneys for the plaintiffs.
Suntech defaulted in March on $541 million of bonds, and eight Chinese banks later that month filed a petition for insolvency and restructuring of the company’s main solar manufacturing unit, Suntech said in a statement on March 20. Suntech said it wouldn’t object to the filing in Wuxi Municipal Intermediate People’s Court.
Suntech’s investor relations department didn’t immediately respond to an e-mail seeking comment on the lawsuit.
Other noteholders have entered into a forbearance agreement and Gilbert, Arizona-based Trondheim and Meixler, who is based in Show Low, Arizona, sued to protect their rights, said Jay Teitelbaum, an attorney for the plaintiffs.
“They are small holders, obviously,” Teitelbaum said in a phone interview. “They feel like they’re just going to get trampled if they don’t exercise their rights.”
Shi Zhengrong founded Suntech in 2002 and took the company public three years later, becoming one of the world’s first solar billionaires. Backed by government loans, the company more than quadrupled its panel-production capacity to 2,400 megawatts a year from 2007 to 2011, dominating the industry.
The case is Trondheim Capital Partners LP v. Suntech Power Holdings Co. Ltd., 652060/2013, New York State Supreme Court, New York County (Manhattan).
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