U.S. solar company SunEdison (sune) is at “substantial risk” of bankruptcy, unit TerraForm Global said, sending SunEdison’s shares down more than 40% Tuesday.
TerraForm Global’s annual report was due by March 30.
However, TerraForm Global said it did not rely substantially on SunEdison for funding or liquidity and that it would have sufficient liquidity to support its operations even if its parent sought bankruptcy protection.
The Wall Street Journal reported on Monday that the U.S. Securities and Exchange Commission was looking into SunEdison’s disclosures to see if it exaggerated its liquidity last year when it said it had more than $1 billion in cash.
SunEdison said on March 16 it had delayed filing its annual report for the second time after identifying “material weaknesses” in its financial reporting, which it said related primarily to problems with a newly implemented IT system.