German solar company Q-Cells (ETR: QCE) is losing its grip in the solar survival-of-the-fittest.
Though it was once the world’s largest manufacturer of solar cells, the company has been struggling for the past year and announced its plan on Monday to file for insolvency.
It had been working on a debt-restructuring plan, involving a debt-equity swap, which was ultimately dropped last week after a court ruling against it.
The Frankfurt Higher Regional Court rejected the plan, which would involve bond restructuring by Pfleiderer (ETR: PFD4), because it would require a unanimous agreement to the restructuring by all creditors.
The company disagreed with this ruling, and said in a statement:
“The company is convinced that the ruling of the Frankfurt Higher Regional Court is incorrect. However, potential lawsuits against Q-Cells’ restructuring plan, which are to be expected, would be handled by the same court. There is no reason to assume that the Court would change its view on this matter. Against this background the Executive Board currently sees ‘no going concern’ for the company.”
But to avoid these lawsuits, the company is no longer moving ahead with the restructuring plan. Yet it is clear something must be done.
Over the last year, Q-Cells lost $1.1 billion and watched shares fall a total of 70%.
Germany is a world leader in solar installations, but the nation has been working to combat oversupply of solar panels by cutting subsidies.
And like companies that have gone before, this was devastating to Q-Cells. In the past few months, Solon (ETR: SOO1), Solar Millennium (ETR: S2M), and Solarhybrid (ETR: SHL) have all filed for insolvency.
On Monday at 11:57am EST, Q-Cells was down 40.57% to 0.126 euro, or $0.1675.
That’s all for now,