LDK Solar to pay USD 47m in compensation for supply deal breach
Dec 27, 2012 - Chinese photovoltaic (PV) products maker LDK Solar Co Ltd (NYSE:LDK) today said that it would pay a compensation of some CNY 294 million (USD 47.1m/EUR 35.5m) for breaching a wafer equipment supply contract with JYT Corp of Beijing (JYT).
The China International Economic and Trade Arbitration Commission (CIETAC) concluded that the contract signed between LDK Solar and JYT in July 2008 is valid and effective over the term and with the quantity and price conditions set in it. Under the agreement, LDK Solar had to buy furnaces used in multicrystalline and monocrystalline ingots production for its factory in China's city of Xinyu.
LDK Solar's president and CEO Xingxue Tong said the company could not take the ordered furnaces from JYT in time mainly because the industry growth was slower than expected and sector players had large capacities available.
LDK Solar will also pay an additional sum of some CNY 3.4 million to cover arbitrage fees in relation to the proceeding.