24/7 Wall St.

Chinese solar PV maker Suntech Power Holdings Co. Ltd. (NYSE: STP) has been down for so long that anything must look like up. The company said Wednesday morning that it has received a letter of intent from an investment group for a total of not less than $150 million to support “a comprehensive rehabilitation and restructuring of the financial and [Suntech’s] operational affairs.” The important point is the “not less than” bit.

The investment group that made this seemingly insane decision is Wuxi Guolian Development (Group) Co. Ltd., an asset management company set up by the local government of Wuxi where much of Suntech’s operations are domiciled. The city wants to keep the Wuxi Suntech operations alive both for the direct jobs Suntech supports and the indirect impact on the local economy.

But $150 million won’t do the trick. Suntech’s non-Chinese creditors have filed claims for $600 million against the company’s U.S.-based parent. Suntech also owes about $2.3 billion in loans from Chinese banks. Last month a Chinese court delayed a ruling on Suntech’s restructuring plan until the end of the year. That ruling is expected to set a precedent for how failing Chinese-based but U.S.-listed companies will be treated under Chinese bankruptcy law.

Suntech’s CEO stated the obvious:

… this is an important step in the restructuring of the Company with key stakeholders. While there will be substantial dilution for existing shareholders, the successful implementation of these efforts will preserve the Company’s international platform, rebuild the Company’s operating assets, and rehabilitate the Company’s global brand.

Suntech’s stock is up nearly 10% in mid-afternoon trading on Wednesday at $1.39 in a 52-week range of $0.30 to $1.99.