Struggling Chinese solar-panel maker Yingli Green Energy Holding Co. will get about 3.3 billion yuan ($508 million) in loans from a state bank and the government where it’s based as it looks to pay off old debts and restructure operations, said a person familiar with the matter.China Development Bank Corp. will lend 2.5 billion yuan to U.S.-listed Yingli, while the government in the city of Baoding will provide the remainder, according to the person, who asked not to be identified because the discussions were private. Yingli, once the world’s biggest solar manufacturer, had total debt of $1.9 billion as of last year and its American Depository Receipts have fallen more than 80 percent in 12 months.
An oversupply has driven panel prices down about two-thirds since 2010, forcing some big Chinese producers, including Suntech Power Holdings Co. and LDK Solar, to file for bankruptcy after failing to repay debts. The loans mark the most significant intervention by a state bank to help struggling solar companies. In 2012, LDK Solar Co., which in November announced a restructuring of its onshore operations, received local government help to pay off a portion of its debt.Caixin magazine reported earlier that Yingli would get more than 2 billion yuan in loans from China Development Bank. As part of the move, Yingli will focus on its photovoltaic business, while other businesses and non-performing assets will be sold or restructured, said the person. China Cinda Asset Management Co., a state-owned asset-management company, has been chosen to join the debt-restructuring effort, the person said.
Yingli had total debt of about $1.9 billion at the end of the third quarter last year. The company hasn’t reported a profit since the second quarter of 2011.Two calls to the Baoding government’s news department went unanswered. China Development Bank didn’t respond to an e-mail request seeking comment. Yingli’s news department declined to comment.Unit Baoding Tianwei Yingli New Energy Co. still owes about 350 million yuan on 1 billion yuan of notes that were due on Oct. 13, 2015. The company is in discussions with bondholders of 1.4 billion yuan of notes due in May.Global solar installations will grow by at least 20 percent this year compared with 2015 and Yingli will focus on panel sales to speed up the turnover of capital as part of its efforts to repay debt, Chief Financial Officer Wang Yiyu said last month.