Yingli defaults on notes due 2016, unable to repay notes due 2015

By Susanna Moon

Chicago, May 12 – Yingli Green Energy Holding Co. Ltd. said subsidiary Baoding Tianwei Yingli New Energy Co. Ltd. failed to repay its RMB 1.4 billion of medium-term notes due Thursday or the remainder of its RMB 1 billion of MTNs due on Oct. 13, 2015.

As reported April 6, Yingli is asking holders for more time to repay RMB 1.4 billion of MTNs due May 12, 2016, or the 2011 notes, due to liquidity issues. The company also had failed to repay RMB 1 billion of MTNs due Oct. 13, 2015, or the 2010 notes.

“To the company’s knowledge, none of the holders of the 2011 MTNs or the 2010 MTNs or other creditors of the company has taken any immediate action against Tianwei Yingli or the company following Tianwei Yingli's failure to repay the 2011 MTNs and the 2010 MTNs today,” according to a company press release on Thursday.

Tianwei Yingli remains in talks with the holders of the 2011 notes and the 2010 notes about extending the repayment dates, the release noted on Thursday.

The company said it is considering alternative financing plans for repayment of the notes, such as adding strategic investors or new creditors as well as the sale of some long-lived assets including land use rights.

The notes were issued by subsidiary Baoding Tianwei Yingli.

For the 2011 notes, the company was proposing to extend the maturity by two to three years, according to a notice.

As for the 2010 notes, Tianwei Yingli had repaid about 70% of the notes when they became due on Oct. 13, 2015.

Bank of Communications Co., Ltd., the lead underwriter for each note series, held meetings for noteholders on March 28.

At the meeting, holders of the 2010 notes sought repayment for the remainder along with accrued interest from April 30 to May 12.

Tianwei Yingli said it told holders that “it will make its best efforts” to repay the remaining 2010 notes before the 2011 notes become due on May 12.

Yingli said on Sept. 30 that it would only repay part of the principal amount due Oct. 13, 2015 on its $157 million of MTNs and that it expected to pay the remaining amount “within one year.”

Yingli Green Energy is a Baoding, China, maker of solar panels.

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