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Has Sunedison Given A Backdoor To Insiders, Large Debt And Equity Holders?!

|Includes: GLBL, SunEdison, Inc. (SUNEQ), TERP

It is very unfortunate, however it seems more than likely that hedge funds beloved company Sunedison is going to file for bankruptcy in the weeks to come. This outcome has been highlighted by several news wires, citing the "people familiar with the matter" (http://www.wsj.com/articles/sunedison-said-to-be-preparing-to-file-for-bankruptcy-1459548775) , and analysts who have been very, maybe even a bit suspiciously, bearish on the companys financials. Many individual investors have shrug off the news and warning signals citing the fact that Sunedsion management has not confirmed them and as put by its representative would not comment on "market rumors and speculation" (http://www.investors.com/news/technology/sunedison-torched-on-market-rumors-of-creditor-negotiations/).

But has the Sunedison management been that quite and not warned the investors, as many think?

Well, at the face value, the answer is yes they have not told much to "not so important" investors-people like you and me who have been investing portions of our IRA's, home mortgages and ISA's, and whose total investment in this company is relatively small to be important.

What about "important" investors- large shareholders, hedge funds, creditors and insiders?

It gets a bit exciting here. No one knows for sure. However take a look at the actions of some of the creditors and stakeholders that have been taking place over the last few months. Doesn't this resemble mice fleeing the sinking boat?

1. DE Shaw-which has agreed at the end of 2015 to extinguish some debt in return for assets (http://renewables.seenews.com/news/sunedison-kills-usd-336m-of-debt-via-sale-of-assets-yieldco-shares-507395).

2. Vivint Solar - which has terminated the takeover deal by Sunedison citing "willful breach" (www.reuters.com/article/us-vivint-solar-...).

3. Although this one has probably received the information by accident. Hawaiian Electric-which has cancelled the deal to purchase power plants from Sunedison at the beginning of 2016 (http://www.bloomberg.com/news/articles/2016-02-17/sunedison-missed-deadlines-on-solar-farms-it-s-desperate-to-sell).

4. Others we do not yet know about...

….and one wonders how much more have the above and probably many others that have not disclosed their share dealings and negotiations in contrast to the aforementioned (which are obliged by the disclosure rules) known. Might have that information been leaked to them by the senior management of Sunedison who are trying to save their face? Possible. We have SEC and DOJ investigations, which show that questions have been raised, although in regards to slightly different matters. But still being investigated means something shady is happening.

It is likely that DE Shaw has been told something way before others. Look how vigorously it is trying to negotiate with Hawaiian Electric regarding the fate of the assets being secured in debt-extinguishing deal made earlier (go to http://dms.puc.hawaii.gov/dms/ and input docket 2014-0356). DE Shaws senior officer has said to be ready to travel to Hawaii to discuss the matters in person!

In regards to Vivint deal, many wondered why has the company which is being taken over cancelled the deal, everyone was expecting Sunedsion to do that. Well according to recent SEC filings one of the points DOJ is seeking information about is "(ii) the conduct of a former non-executive employee who is alleged to have committed wrongdoing in connection with the Vivint termination negotiations". (http://investors.sunedison.com/phoenix.zhtml?c=106680&p=irol-SECText&TEXT=aHR0cDovL2FwaS50ZW5rd2l6YXJkLmNvbS9maWxpbmcueG1sP2lwYWdlPTEwODUwNzU4JkRTRVE9MCZTRVE9MCZTUURFU0M9U0VDVElPTl9FTlRJUkUmc3Vic2lkPTU3) Might it be that Vivint has cancelled the deal after Sunedison employee had told them the facts and the certainty of bankruptcy? Whereas now Sunedison is probably trying to dispute that by blaming the employee, saying that he lied and they (Sunedison) were not planning to cancel the deal. Since if that is true then, if you think about it, Vivint might have a good point in the court case they filed for "willful breach".

Regarding the Hawaiian Electric, I read somewhere but cannot find the link (basically Hawaii Electric killed the deal after the conference call with Sunedison and D.E.Shaw).

…In addition to that we have news wires, which are constantly getting leaked insights on what's happening behind the closed doors. What stops those getting this info or leaking it in the first place to make some money by longing or shorting the shares!? Obviously it takes time to write up an article once you have an info. Why can not Sunedison management prevent the leaks or at least make it public?

…THEREFORE, if all the rumors about going bankrupt come out to be true then it would not be unfair to say that Sunedisons management has lost its credibility and acted on the borderline of fraud, as explained earlier. The company transactions and conversations (although they would be destroyed by now or not recorded) with the shareholders, creditors and other stakeholders, which have managed to take out assets or sell their shares, need to be investigated. In the meantime it is in Sunedisons interest and its individual shareholders for the management to get some courage and start communicating their actions clearly. People are losing real hard earned cash, this is not a joke!

…P.S. For all the existing "small" shareholders, including myself I wish to be patient and hope that rumors are not going to realise or someone will come to save the company! If you haven't sold by now, I think it might be a bit late now, it is probably more prudent to hold and hope for a miracle!

Disclosure: I am/we are long SUNE.