China Development Bank provides a $23 million USD loan to LDK Solar for the acquisition of a 70% equity stake in Solar Power, Inc.

Project narrative

On March 28, 2011, the Hong Kong Branch of China Development Bank Corporation (CDB) entered into a $23,000,000 USD term loan facility agreement with LDK Solar Co., Ltd. — a Cayman Islands-incorporated Jiangxi, China-based manufacturer of photovoltaic solar panels listed on the New York Stock Exchange (NYSE) — for the acquisition of a 70% equity stake in Solar Power, Inc. (SPI), a California-incorporated U.S. solar power company listed on the Main Board of the NYSE. This loan carried a maturity period of five years and a final maturity date of March 28, 2016. It was governed by Hong Kong law. This loan was secured by (i.e. collateralized) a share pledge of the shares in Solar Power, Inc. owned by LDK Solar USA, Inc. — a California-incorporated wholly-owned subsidiary of LDK Solar — per a share pledge agreement, with the sole recourse for the loan being that collateral. Jiangxi LDK Solar Hi-tech Co., Ltd. — a China-incorporated wholly-owned subsidiary of LDK Solar — issued a corporate guarantee for this loan. The proceeds were used by the borrower to on-lend to LDK Solar USA, Inc. via an intercompany note in order to finance its proposed acquisition of 70% of the total issued and outstanding share capital of SPI Solar and other costs and expenses related to it. LDK Solar entered into a Stock Purchase Agreement with SPI on January 5, 2011. The acquisition cost approximately $33 million USD, with LDK paying $10 million USD in January 2011 and then paying the remaining balance with CDB. The acquisition was completed in March 31, 2011 and gave the borrower, among other things, control of SPI's manufacturing plant in Shenzhen, Guangdong province. As of March 2014, $11,000,000 USD was outstanding under this loan./ By 2014, LDK Solar's stake in SPI Solar had fallen to 39.41%. LDK Solar went into liquidation in the Grand Court of the Cayman Islands per a wind up petition filed on February 21, 2024. On October 21, 2014, LDK Solar Systems Inc., LDK Solar USA Inc. and LDK Solar Tech USA Inc. filed a prepackaged Chapter 11 reorganization plan with the U.S. Bankruptcy Court for the District of Delaware with a debt-for-equity swap. Global drops in the price of solar products and decreased demand negatively impacted LDK Solar. SPI Solar, however, did not file for bankruptcy.