UPDATE 2-SunEdison in debtor-in-possession financing talks-Debtwire

Tue Mar 22, 2016 1:30pm EDT
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* SunEdison in talks for about $300 mln in new liquidity

* Talks follow attempts to reach out-of-court solution

* Shares fall as much as 19.4 pct (Adds analyst comment)

March 22 (Reuters) - Embattled solar company SunEdison Inc is in talks with holders of its second-lien loans to fund a debtor-in-possession financing facility, Debtwire reported, citing two sources familiar with the matter.

Shares of the company, which is grappling with a huge debt load caused by its aggressive acquisition strategy, fell as much as 19.4 percent to $1.62 on Tuesday.

The talks this week have focused on providing the company with about $300 million in new liquidity, Debtwire reported.

"DIP negotiation means that the company has effectively run out of cash and they get to pay their creditors 'fair market value' for the secured assets versus the contracted value," Axiom Capital analyst Gordon Johnson told Reuters.

The talks follow unsuccessful attempts by second-lien lenders to reach an out-of-court solution for the company's cash shortage and debt issues, Debtwire reported, citing the sources.

The investor group includes those holding term loans of a total of $725 million, Debtwire reported.   Continued...