XINYU, China (
has completed a 16.5 million equity offering and raised $111 million.
While the equity raise will help LDK pay down its huge amount of outstanding debt -- LDK said it will use $90 million to pay down short-term debt and invest the remainder in its polysilicon production plant and the expansion of the solar module business -- the offering was far from a complete success.
LDK originally filed to offer more than 18 million shares on Dec. 17, and
investors pummeled the shares, sending them down 15% because of the impending dilution. The following day, LDK re-filed for the lower number of shares at a discounted price, and investors again responded by driving down LDK shares another 10%.
Even with the stock sale and the recent unloading of a polysilicon plant, LDK, which has a debt-to-total-assets-ratio of 50%, isn't out of the woods yet, according to solar analysts. "This barely scratches the surface of what is needed to improve the LDK balance sheet," said one industry analyst.
Shares of LDK were down 2.2% to $6.79 Wednesday afternoon, below the $7 price on the discounted secondary offering. For most of November and December, LDK shares traded above $9, up from a 52-week low of $3.75, reached in March.
acted as joint bookrunners for the LDK offering.
-Reported by Eric Rosenbaum in New York.
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