Hedge funds to buy Conergy debt, control: report

FRANKFURT (BestGrowthStock) – Hedge fund buyers have agreed to buy debt owed by struggling Conergy (CGYG.DE: ), a move which could eventually hand them a controlling stake in the solar equipment company, the Financial Times Deutschland reported.

A group of hedge funds including York Capital and Sothic Capital have agreed in principle to buy the debt which can be converted into equity, the Financial Times Deutschland said in its Friday edition, without naming sources.

The hedge funds have amassed control over at least 25 percent of the company, the paper said.

Commerzbank (CBKG.DE: ) with a stake of around 30 percent is Conergy’s largest shareholder.

Last week, debt-laden Conergy said it had re-entered talks with banks after an independent review concluded its balance sheet needed restructuring.

Conergy has been piling up losses in recent years after it ran into trouble expanding into the renewable energy industry.

Conergy agreed a deal with lenders in July to extend credit lines until the end of 2011 and commission a review of the business by an outside auditor. [ID:nLDE66T03D] (Reporting by Harro Ten Wolde and Edward Taylor; Editing by Dan Lalor)

Hedge funds to buy Conergy debt, control: report