Home » Technology » Suntech Power Holdings Co., Ltd. (ADR) (NYSE:STP): Buffett’s Rumors Continued To Push Up The Stock

There have been rumors that Warren Buffett might buy shares from Suntech Power Holdings Co., Ltd. (ADR)(NYSE:STP), the solar energy company, which was recently declared bankrupt. Although the news is largely unconfirmed, the rumor mills have been whispering that Buffett might just decide to save the company which is barely being able to stay afloat.

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Solar shares have been suffering for a very long time now, and investors are turning their faces away, since buying shares from a solar energy company does not seem to be very lucrative, but many analysts suggest that Suntech might be able to bounce back up, if western investors take an interest in the company. They can help revive the dying industry, which is suffering as a whole, and the vote of confidence from western investors might also help them perform better. Before these rumors came into circulation, people were expecting the government to intervene in order to save Suntech.

The very rumor of Buffett being interested in buying large shares of Suntech has given this industry a boost in terms of stocks and shares. Chinese solar companies have seen a rise in the price of shares, and the sales have increased drastically. Suntech itself, saw a rise in the prices, which is up by about 16 percent since the rumors began.

Buffett has been known to take avid interest in energy industries. They seem to be growing a lot, especially since various governments are pushing for alternative sources of energy which do not involve fossil fuels. Buffett has invested in a number of solar energy companies in the U.S, and in 2008 he had bought 10 percent of BYD’s shares. BYD is a Chinese company which manufactures electrical automobiles such as buses and cars. However, while the U.S investments are paying off, the same cannot be said of BYD.

Suntech seems to have a complicated situation, which is further complicated by its owner, Shi Zhengrong, who was a rich Chinese businessman, but whose callous moves lead the company to bankruptcy, and who refused to let go of the company in return for a government bailout. The company is currently under debt of 500 million USDs, and it is unlikely that Buffett would want to get his hands dirty by involving himself in the murky affairs of Suntech’s future.

Share of the company soared 30% to 62 cents  after gaining about 15% in yesterday’ session. The stock is still down 55% for this year so far.

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