Once the world's largest producer of solar panels, China's Suntech has now filed for bankruptcy. Analysts said oversupply and dumping prices meant the company's undoing, coupled with economic woes in Europe and the US.
The New York-listed company on Wednesday officially declared itself bankrupt, the Xinhua news agency said. Suntech declined to immediately comment on the Xinhua report. The company last week defaulted on repayments for a $541 million (420 million euro) bond issue.
Xinhua said the firm was seeking "bankruptcy reorganization" in a bid to save what could be saved through a restructuring plan.
The Chinese company looks back at a painful journey from the world's biggest solar module producer to going bust within just a year. Its development highlighted the woes of the industry it itself had shaped in no small way.
Digging its own grave?
Analysts said Suntech had fallen victim to the solar industry being burned by the economic slowdown in Europe and the United States, but its fall was also seen as a direct consequence of a strategy to secure larger market shares worldwide by undercutting competitors despite lower profit margins.
"What Suntech has done is increase supply to the market so much that they really almost can't sell anything at a profit now," China Market Research Group's Ben Cavender commented.
Suntech logged a net loss of $1 billion in 2011, down from a profit of $237 million in 2010, with results for last year not out yet. The company's founder, Shi Zhengrong, was ousted as chairman earlier this month.
hg/dr (AFP, dpa, AP)