Solar cells. Author: Arne Krueger. License: Creative Commons.
Chinese transformer and power equipment maker Baoding Tianwei Group Co and three of its wind- and solar-focused units are to enter reorganisation proceedings as the company has officially filed for bankruptcy.
Baoding Tianwei explained in a statement that it and its subsidiaries are currently insolvent and are unable to settle outstanding debts. All of their businesses have been suffering since 2011, chiefly because of an overall economic slowdown coupled with overcapacity and falling prices in the renewable energy segment, the firm noted.
The move comes just months after Baoding Tianwei became the first state-owned Chinese firm to default on an onshore bond by failing to pay CNY 85.5 million (USD 13.4m/EUR 12m) of interest due April. Not long before that two polysilicon producing units of affiliate Baoding Tianwei Baobian Electric Co were also declared bankrupt.
Baoding Tianwei is part of China South Industries Group Corp. In 2014, it booked an annual net loss of some CNY 10.1 billion, hurt by impairment provisions and a swift change in its debt-to-asset ratio.