On Dec. 2, 2011, we posted a write-up on how short sellers, those betting on the downside, were circling Hoku (HOKU, NASDAQ, 52 week range 0.10 – 2.05) like sharks. (Read: Hoku Corporation a Falling Star.) At the time, Hoku’s shares were trading at $0.80 per share. On May 24, the shares traded as low as $0.10 per share, a new all-time low, down over 80 percent in less than six months.

At the end of the post, we said,

Short sellers are usually pretty savvy and negative folks, so this also tells us that they must feel that the shares are going even lower before they cover their positions. It also says that Tianwei will probably end up owning Hoku completely as the largest shareholder and holder/guarantor of its debt.

The latest news is that Hoku has laid off 100 workers in its Idaho plant and has retained Imperial Capital to advise on restructuring the company and its debt. In a statement from the company, “Due to the delinquency of unpaid construction obligations, liens have been filed against the Hoku Materials polysilicon plant, and some lienholders have begun foreclosure proceedings in the Idaho courts.”

The company also has indicated that its successful Hoku Solar subsidiary will not be part of the restructuring effort.

At this point, the company’s shares are trading at a market capitalization level under $10 million, with debt levels over $300 million. Investors should stay away as the likely scenario from here is that Tianwei ends up with whatever is left after the creditors are satisfied. The only money to be made already has been from the short sellers.