Short interest in Suntech Power Holdings has plunged to its lowest level since 2007, suggesting investors have closed out positions betting it will decline after the Chinese solar company’s main unit went bankrupt.
The portion of outstanding American depositary receipts sold short fell to as little as 2.2 percent on April 3 from 6.5 percent on March 18, according to data from Markit Group Ltd., a London-based researcher. The percentage was 3.2 percent April 11.
“Short sellers have gradually covered their positions in Suntech, taking profits as the stock neared zero,” Alex Brog, a director at Markit, said by phone. “Now that the shares can’t fall much further, almost all are out.” Suntech’s ADRs are each worth one ordinary share.
Suntech, once the top solar panel manufacturer, may become the largest renewable-energy insolvency after its main unit was pulled into bankruptcy proceedings in China on March 20. The ADRs that reached as high as $88 in January 2008 fell to as little as 36 cents on April 1 and closed at 75 cents in New York yesterday.
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