Greentech Lead Asia: Suntech, the Chinese solar major that filed for bankruptcy last month, may sell its Italian assets as part of its strategy to pay off debts.
Suntech is reportedly in talks with investors, and rumors are that billionaire investor Warren Buffett might buy Suntech’s GSF stake in Wuxi at steep discount to GSF’s current value.
GSF has an enterprise value of up to US$800 million, but Suntech’s stake would likely be worth far less than that amount since the solar plants that are GSF’s main assets were built when solar panels prices were sharply higher than their current levels, according to the report.
However, the deal is unlikely to have a major cash infusion, the report said.
Suntech could sell its 88 percent stake in GSF, which the company acquired by supplying solar plants to GSF. Suntech’s relationship with GSF also came under scrutiny last year as the former was found using sales to GSF to inflate its own revenue figures.
Even if Suntech sells its stake in GSF, it would not be sufficient to cover up its debt of more than $2 billion.
Last month Suntech defaulted on $541 million of its dollar-denominated bonds and said its biggest subsidiary was bankrupt.