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Summary:

As expected, beleaguered solar startup Solyndra has officially filed for bankruptcy. The company’s rise and fall has turned into the clean power controversy of the summer and increasingly ugly details continue to emerge.

Solyndra's 300K Square Foot Factory

Solyndra's 300K Square Foot Factory

As expected, beleaguered solar startup Solyndra has officially filed for bankruptcy. The company’s rise and fall has turned into the clean power controversy of the summer, having raised close to a billion dollars of funding from private investors, and drawn down on most of a $535 million loan from the U.S. government. You can read the full bankruptcy filing here on pacer (Case No. 11-12799) in the U.S. Bankruptcy Court, District of Delaware.

Reuters and Bloomberg do a solid job of detailing the important bits from the filing, so I’ll sum up their reporting in these bullet points below:

  • Solyndra is trying to sell itself before a firesale and plans to spend the next four weeks trying to find a buyer.
  • Solyndra says it cut its prices in order to compete in the industry, but couldn’t match the “extended payment terms” offered by foreign competitors.
  • Argonaut Ventures owns about 39 percent of the parent company of Solyndra, 360 Solar Degree Holdings and is “among the company’s first-lien lenders, meaning it will be the first to be repaid, ahead of the U.S. government.” Madrone Partners holds 13 percent of the equity, USVP Venture Partners holds about 9 percent, and Rockport Capital Partners owns about 7 percent.
  • Solyndra has secured debts of $783.8 million.
  • Argonaut and Madrone will give Solyndra $4 million in debtor-in-possession financing, at 15 percent interest, to help the company through the four-week buyer search. That has to be paid back first, as well as $69.3 million to the first lien lendors before the U.S. government is paid back.
  • The U.S. Federal Financing Bank, owned by the U.S. Treasury Department, is the company’s biggest lender.
  • Via Bloomberg, in recent weeks the DOE negotiated with Solyndra investors for bridge financing to give the company time to find a new source of capital.

Bloomberg also reported on the details of the senior debt for Solyndra this weekend. Bloomberg cited a government document that said in January 2011, private investors gave Solyndra another $75 million to try to stop it from going bankrupt, and that $75 million became senior debt that ensured it would be paid back ahead of $385 million in U.S. federal loans.

Former Solyndra employees have also filed a class action lawsuit claiming Solyndra had to give employees 60-days notice before cutting more than 50 workers — Solyndra laid off 1,100 employees last week. An exception to that rule is that a company has to be looking for more funding up until the end and Solyndra says it was.

  1. You can’t view the bankruptcy filing without registering for PACER and agreeing to pay .08/page for online access. Not sure how big the filing is, so I didn’t download it. Is there another way to access the filing?

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  2. Government shouldn’t be making bets on individual companies. The upside is minimal — one company that has an incentive to keep its trade secrets to itself will prosper and create some jobs, but at a very high cost per job. The downsides are large — including wasting capital that could be put to more effective use elsewhere.

    John Howley
    http://www.john-howley.com

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  3. http://www.zerohedge.com/contributed/solyndra-obama-connection
    Kaiser and Argonaut? …is this why they got the loan and get paid before the DOE?

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