Shares of LDK Solar plunged further Friday as the Chinese solar panel maker priced at a deep discount an equity offering that it said is part of the capital raise it needs to continue operating.
On Thursday, LDK Solar said in a filing with the Securities and Exchange Commission that it must improve its liquidity situation in order to continue to operate as a going concern. It said it plans to sell 18.9 million American depositary shares as part of this plan.
On Friday, LDK Solar cut its offering to 16.5 million ADSs, priced at $7 each. Underwriters can buy an additional 2.5 million shares.
The $7 price was a nearly 11 percent discount to Thursday's closing price.
LDK Solar said it has a working capital deficit of $1.15 billion on Sept. 30, with cash and cash equivalents of $67.7 million. In the nine months ended Sept. 30, the company had a net loss of $209.9 million and used $95.2 million of cash in operations.
The company said it expects net proceeds from the offering of about $108.1 million. About $90 million will be used to pay down short-term debt, the company said in the SEC filing.
In addition to selling shares, LDK Solar said it plans to obtain more bank loans, renegotiate contracts with suppliers, and potentially sell assets in order to raise capital.
Its shares fell about 13 percent in afternoon trading Friday. On Thursday they tumbled nearly 15 percent.