LDK Solar Co., Ltd. ( LDK ) announced the
sale of $15.4 million worth of its newly issued shares to Fulai
Investments Limited. The company will sell 12.0 million shares
priced at $1.28 per share each. The gains from this sale of shares
will be utilized for general corporate purposes in LDK Solar's
The company in late Feb 2013 declared the sale of $5.0 million
shares to Fulai Investments at a purchase price of $1.83 per share,
which came to an aggregate amount of $9.2 million.
Earlier, in Jan 2013, the company entered into an agreement to
sell $31.1 million worth of its outstanding shares to Fulai
Investments Limited. LDK Solar is trying to reduce its massive debt
burden of $3.1 billion through restructuring and the sale of
LDK Solar sought a RMB 440 million ($69.8 million) loan from the
China Development Bank Corporation for the purpose of financing
technological modernization works at the Mahong Polysilicon Plant.
The company also had to shed its loss making LDK Anhui asset for
RMB 25 million (approximately $4.02 million) to Shanghai Qianjiang
The stifling trade barriers adopted by the U.S. which includes
countervailing duties ("CVD") of 15.24% and anti-dumping duties
("AD") of effectively 25.96% have taken a toll on the company's
businesses in North America. Moreover, the rumor of a possibility
of Europe levying tariff duties on solar panels could further hurt
the company's operations.
However, LDK Solar is anticipated to offset these headwinds by
relying on the Chinese domestic market which has bounced back after
an economic slowdown. Additionally, the Chinese government's
proposed offering of subsidies to solar projects and free grid
connection to PV distribution programs are factors that will work
in favor of LDK Solar.
The company presently retains a Zacks Rank #3 (Hold). Other
solar players currently performing well are Zacks Ranked #2 (Buy)
Canadian Solar Inc. ( CSIQ ),
ReneSola Ltd. ( SOL ) and STR
Holdings, Inc. ( STRI ).
Based in Xinyu City China, LDK Solar and its subsidiaries are
engaged in the design, development, manufacture, and marketing of
photovoltaic ("PV") products; and development of power plant
projects.CANADIAN SOLAR (CSIQ): Free Stock Analysis
ReportLDK SOLAR CO (LDK): Free Stock Analysis ReportRENESOLA LT-ADR (SOL): Free Stock Analysis
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