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Suniva pushes bankruptcy lenders for more money as trade case enters final phase


According to Market Intelligence, December 2022


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Suniva pushes bankruptcy lenders for more money as trade case enters final phase

Suniva Inc. is scrambling to secure more money from its bankruptcy lenders heading into the final phase of a bitter trade fight that is expected to decide the fate of the solar panel manufacturer and could reshape the entire U.S. industry.

Judge Kevin Gross scheduled an Oct. 13 hearing in U.S. Bankruptcy Court for the District of Delaware to consider Suniva's emergency motion to borrow at least another $2.8 million from SQN Asset Servicing LLC and Lion Point Capital LP. Suniva has already drawn down a $5.3 million debtor-in-possession fund that was financed by SQN and Lion Point.

The parties are still negotiating how much more money Suniva should receive, according to an Oct. 5 court filing. Suniva said it made "numerous requests" for additional funding, but that its lenders' response was "unsatisfactory." Without access to new capital, the company said its reorganization efforts "could be unnecessarily jeopardized."

Lawyers for SQN and Lion Point did not immediately respond to requests for comment Oct. 10.

In April, Suniva asked the U.S. International Trade Commission, or ITC, to recommend that President Donald Trump set tariffs and minimum prices on imported solar cells and panels in order to shield domestic manufacturers from foreign competition. SolarWorld Americas Inc. joined Suniva's case about a month later.

Members of the ITC, who in September unanimously found that U.S. companies making crystalline silicon solar cells and panels were seriously injured by a surge of cheap imports, criticized Suniva and SolarWorld Americas on Oct. 3 for failing to file adjustment plans outlining how the companies would become more competitive if Trump sets import tariffs.

"While the Debtor is pleased with the progress that has been made in the trade case to date, much more remains to be done," Suniva's lawyers wrote in an Oct. 5 court filing. Suniva previously said that without trade relief, the company "certainly will be out of business permanently."

With the ITC's report due to Trump by Nov. 13, Suniva and SolarWorld America's opponents recently launched an advertising campaign aimed at convincing a president who has championed fossil fuels and called for trade tariffs not to impose safeguards that would make solar equipment more expensive in the U.S., Axios reported Oct. 9.

Manufacturing accounted for about 15% of the U.S. solar industry's approximately 260,000 jobs in 2016, according to The Solar Foundation, an industry advocate. The group does not track how many people worked specifically in solar cell and panel production.

"These two companies have demonstrated no plan to survive even with their requested remedies," said Edward Fenster, executive chairman of rooftop solar developer Sunrun Inc.

Matt Card, executive vice president of commercial operations at Suniva, said Suniva's adjustment plan and "go-forward behavior will be dictated by ... the bankruptcy and how we emerge" from that process. The company expects to exit bankruptcy by the end of the year, Card said.