Solarstrom changes insolvency horse
The executive board of solar developer SAG Solarstrom has decided to switch its insolvency – which has so far been managed under self-administration – into general insolvency proceedings on 1 March.
“The opening proceedings have shown that both investors and creditors have only limited experience with the comparably new process of self-administered insolvency,” the company said in an ad-hoc statement to stock markets.
“The parties involved agree that the company can be restructured and reorganized more simply and more quickly using the means of insolvency proceedings through the better-known general insolvency proceedings."
Insolvency under self-administration is a procedure in German bankruptcy legislation similar to the US chapter 11 rule that temporarily grants the company creditor protection.
Solarstrom’s announcement of insolvency under self-administration in December was the latest in a series of insolvencies in the once-mighty German solar industry, which in large parts has not been able to withstand the pressure of cheap Chinese competition.
After the failure of the refinancing talks, SAG Solarstrom said it saw no option for implementing a short-term financial restructuring outside of insolvency proceedings. The proceedings started a week after the company admitted that negotiations regarding its near-term project pipeline had fallen through.