Solar panel firm founder 'upbeat' despite dim outlook on debt
Shi Zhengrong, the former billionaire dubbed the "Sun King" for the meteoric rise of his solar company, Suntech Power, remains "upbeat and very positive", even as a possible debt default looms, according to the firm's chief technology officer.
Stuart Wenham, who has served as Suntech's main technology executive since the firm's founding in China in 2001, said Dr Shi was relaxed and confident during a meeting last week, even after he was ousted as chairman.
"How can you own 30 per cent of the company - much more than the next biggest shareholder - and not have a say in its future?" said Dr Wenham, who was co-supervisor of Dr Shi when he was doing his PhD at the University of NSW, and serves as director of its Photovoltaics Centre of Excellence.
This week may prove crucial to the future of Suntech, which is one of the world's largest makers of solar PV panels.
The company earlier this week secured agreement with 60 per cent of bondholders to delay repayments by two months to May 15 on convertible debt totalling $US541 million ($525 million).
Some of the remaining 40 per cent of bondholders, though, say they aren't prepared to wait that long and may sue the US-listed company if repayments are missed this week.
"Every piece of information that I've looked at suggests they will default on Friday," James Millar, a partner at law firm Wilmer Cutler Pickering Hale and Dorr in New York, told Bloomberg.
Suntech rose to prominence when it became the first Chinese solar company to be listed on the New York Stock Exchange in 2005. Its stock quadrupled by the end of 2007, valuing founder Dr Shi's stake at more than $3 billion.
Suntech's stock price and Dr Shi's status have since plummeted amid a global glut of solar PVs.
Dr Shi was ousted as Suntech's chairman seven months after being replaced as the firm's chief executive officer. He said he was "shocked" by his removal and warned the company needed a "viable business plan".
Concerns about Suntech's possible debt default caused its shares to resume their slide this week. They lost a combined 14 per cent on Monday and Tuesday to $US1.09, about one-eightieth of their record close on Boxing Day 2007.
The company's strained finances were on display on Tuesday when Suntech revealed plans to shut its US plant in Arizona next month - just 30 months after its opening.
The company blamed the closure, in part, on the US government's decision to slap anti-dumping tariffs of 36 per cent on its solar cell imports from China.
The firm's best chance of survival is likely to be in the form of a bailout by authorities in China, as has happened to several other cash-strapped solar energy firms.
Whatever the outcome of the debt repayments, Dr Shi is certain to remain active in the industry, Dr Wenham said.
"It's his passion - it's not a job or a career," he said. "It's his life."