On November 17, 2015, Xinyu City Chengdong Construction and Investment Corporation (Xinyu Chengdong) and China National Grid Corporation Ganxi Power Branch ("Ganxi Power" and, together with Xinyu Chengdong, the "Applicants") applied against four onshore subsidiaries of LDK Solar (the "Respondents") in China for enforcement of payments or dues as well as for bankruptcy restructuring of each of the Respondents. The applications have been accepted by the Intermediate People's Court in Xinyu City of Jiangxi Province (the "Xinyu Intermediate Court") pursuant to the Enterprise Bankruptcy Law of the People's Republic of China (the "PRC Bankruptcy Law").
Jiangxi LDK Solar Hi-Tech Co., Ltd., LDK Solar Hi-Tech (Xinyu) Co., Ltd., Jiangxi LDK PV Silicon Technology Co., Ltd. and Jiangxi LDK Solar Polysilicon Co., Ltd., are LDK subsidiaries that were faced the applications and bankruptcy restructuring. They are unable to pay the payments in the aggregate amount of RMB 281,581,675 relating to borrowings and project fees due to Xinyu Chengdong, and RMB 53,473,487 relating to electricity charges due to Ganxi Power.
The Xinyu Intermediate Court declared the commencement of the bankruptcy restructuring of the Respondents and has designated a specially organized "Restructuring Group" within the Xinyu Hi-Tech Industrial Park Management Committee (the "Management Committee") as the administrator as called for under the PRC Bankruptcy Law, with Mr. Shaorong Xu, Director of the Management Committee, as the responsible person in charge of the administrator and Jiangxi Yaojian Law Firm responsible for specific matters in the bankruptcy restructuring.
"It is regrettable that we have come to this inevitable juncture on our onshore financial crossroads, despite the tremendous efforts we have made in order to make progress in our onshore financial restructuring subsequent to our successful offshore financial restructuring," commented Mr. Zhibin Liu, Chairman, President and CEO of LDK Solar. "Nevertheless, we will cooperate with the court and will endeavor to achieve a reasonable and balanced result for LDK Solar and its stakeholders.”
A representative said the bankruptcy restructuring will not suspend or cause any impact to the company’s revived production. The company manufactures up to 1.6 million pieces of wafers per day, and the wafers are better than old ones in quality, quantity and costs.