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BEIJING — Suntech, one of the world’s biggest solar-panel manufacturers, was forced into bankruptcy court Wednesday, becoming the latest casualty of a painful slump in the global solar industry.
Suntech Power Holdings Ltd. said eight Chinese banks asked a court to declare it insolvent after the company missed a $541 million payment to bondholders last week. Suntech said it would not oppose the petition.
The development is a dramatic reversal for a company that was a leading force in China’s fast-growing renewable energy industry. Its founder, Shi Zhengrong, has seen much of his multibillion-dollar fortune evaporate.
“While we evaluate restructuring initiatives and strategic alternatives, we are committed to continuing to provide high-quality solar products to our global customer base,” Suntech CEO David King said in a statement. “During this period, we will continue to work closely with all of our stakeholders and take the necessary steps to put Suntech back on track for growth.”
Solar-panel makers have suffered huge losses over the past year after rapidly growing production capacity outstripped demand and prices plunged. Another industry giant, Germany’s Q-Cells, filed for bankruptcy last April.
Suntech, with headquarters in the eastern city of Wuxi, west of Shanghai, also has been hurt by a revelation in July that a business partner faked $680 million in collateral for a loan Suntech had guaranteed.
“Suntech’s bankruptcy rather strengthens the position of other leading suppliers,” said Stefan de Haan, a solar analyst at IHS Inc. in Munich. “The consolidation in the PV industry will continue. There are still many hundreds of suppliers, and there is still a fundamental overcapacity in the market.”
Among those benefiting Wednesday was First Solar Inc., which saw its stock price rise six percent to close at $29.49. First Solar started in Toledo before moving its headquarters to Tempe, Ariz.
Its only U.S. production facility is in Perrysburg Township. First Solar was the world’s fourth-biggest solar panel manufacturer in 2012.
The glut of supply in the solar-panel market was brought on in large part by the Chinese government’s efforts to promote the industry.
But a 10-fold expansion of overall Chinese solar panel manufacturing capacity from 2008 to 2012 produced a three-quarters drop in solar panel prices, undermining the economics of the business. Rapid expansion of natural-gas production in the United States and a curtailment of subsidies in the European Union also hurt solar-panel prices, as did a U.S. imposition last year of import tariffs totaling about 40 percent after an anti-dumping and anti-subsidy investigation