Understanding China, One Blog at a Time

An American in China

Suntech Another Chinese Stock Fraud?

Posted by w_thames_the_d on August 3, 2012


If you buy stock in a chinese company, then you are an utter idiot.
Story

An analyst with the US investment firm Maxim in New York has given Chinese solar manufacturer Suntech a sell rating, saying its stock is worthless, according to the 21st Century Business Herald in Guangzhou.

“The company has no option but to announce bankruptcy and seek reorganization,” the analyst was quoted as saying.

The comment came after Suntech announced on July 30 that its affiliate Global Solar Fund had defrauded it in offering €560 million (US$688.5 million) in German bonds as collateral.

Global Solar Fund offered the bonds to convince Suntech to act as its guarantor for a loan of €554.2 million (US$681.4 million) from China Development Bank in 2010. Since the bonds didn’t exist, Suntech would have to repay Global Solar Fund’s loan if the company failed to repay it to the bank.

Link

http://www.wantchinatimes.com/news-subclass-cnt.aspx?cid=1102&MainCatID=&id=20120803000006

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