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Hoku (HOKU) Announces Construction at Polysilicon Production Plant Has Stopped; Has Ceased Operations, Terminated All Staff at Tianwei Solar

May 22, 2012 5:05 PM EDT Send to a Friend
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Shares of Hoku (Nasdaq: HOKU) halted to announce confirmation of a substantial reduction in construction activities at the polysilicon production plant of Hoku Materials in Dec. 2011, and by last month (April 2012), all construction contractors had stopped work.

As of March 31st, the company said preliminary estimates of cash, other assets and current liabilities were ~$7.7 million, $6.7 million, and $278.8 million, respectively.

The Company announced that it received an additional loan from China Merchant's Bank, New York Branch, which is secured by a cash collateralized letter of credit drawn by Hoku's parent company, Tianwei New Energy Holdings Co., Ltd

In the meantime, Hoku Materials reported that it has terminated approximately 100 of its Pocatello plant employees. This reduction in force is necessary to conserve cash while the Company pursues restructuring alternatives.

In addition, the Company reported that it has ceased business activities and terminated all staff at Tianwei Solar USA, Inc., the wholly owned subsidiary formed to market and sell Tianwei's modules in North America, and that Hoku Solar would continue to seek opportunities to sell Tianwei's modules in this market.




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