How many short positions need to be closed

Shorts must be anxious in case a deal is struck with the banks at a decent price, and will be doing their damnedest to undermine confidence.
Why would the banks not want shares in a company that would be very profitable with a reconstructed balance sheet?
When Helphire (now Redde) had a similar experience in the U.K., the lenders took shares to extinguish the bulk of debt (alongside a rights issue) The banks took new stock. This stock can then be dripped into the market.
Better than selling debt at 30 - 40c in the dollar. The buyers of debt at these types of prices, must have had confidence that they would make a profit on the deal.
What percentage of SGH equity is currently shorted? Anybody got the latest figure?
If I was short I would be getting twitchy. I would personally not believe everything I read in the newspapers!
BUT DYOR research obviously.
Have a look at REDD in UK about 4 years ago, and its debt restructuring deal.