Chinese manufacturer LDK Solar has defaulted on a debt payment of $23.8m because of a ‘temporary cash-flow shortage’.
The company said it has reached a settlement with two bondholders through a partial payment in cash to delay payments of $16.6m, and the company is, ‘ready and willing to discuss and reach a settlement for the remaining convertible notes,’ it said in a statement.
Today’s news comes almost a month after another of China’s largest solar manufacturers, Suntech Wuxi, went into bankruptcy after it also defaulted on loan payments.
LDK now becomes only the second company ever allowed to go into default by the Chinese state, which had previously kept solar companies propped up.
Its shares have fallen 48 per cent since the beginning of the year as the company recorded losses for the past six quarters with fourth quarter 2012 results due on Thursday.
At the time of writing, LDK’s shares stood at $1.12.