Korean polysilicon producer Hankook Silicon close to bankruptcy
On June 10, a court in Seoul decided to terminate the rehabilitation proceedings for Hankook Silicon after two attempts to sell the Korean polysilicon manufacturer failed and the company did not file a restructuring proposal by the end of May. According to the Korean website hankyung.com, the company will loose the protective shield of court administration within two weeks if it does not appeal against the decision.
Hankook filed for rehabilitation proceedings – a procedure similar to Chapter11 in the U.S. – in May 2018. It was the second time after it applied for court receivership in November 2012.
In view of cash production costs of $12.50/kg and a spot price below $10/kg, the manufacturer has produced red figures with every kilogram of polysilicon. In 2018 Hankook recorded a net loss of KRW74.3 billion (US$67.5 million). According to hankyung.com, the company piled up a total debt of KRW509.9 billion (US$434 million) by the end of March 2019.
An investment banker told hankyung.com: “It is difficult to avoid bankruptcy, auction and liquidation as the two attempts to sell off [the assets] during the rehabilitation process were not successful.”