March 26 (Renewables Now) - Seeking to reduce its debt, China’s Shunfeng International Clean Energy Ltd (HKG:1165) has conditionally agreed to sell the subsidiary that owns solar module supplier Wuxi Suntech Power and includes its upstream manufacturing business and other overseas operations.
Through its unit Shunfeng Photovoltaic Holdings Ltd, the renewables group will offload Jiangsu Shunfeng Photovoltaic Technology Co Ltd to Asia Pacific Resources Development Investment for some CNY 3 billion (USD 446.8m/EUR 395.5m), it said in a bourse filing on Monday, adding that the deal will include the assumption of some CNY 1.2 billion in debt.
The transaction will help the group lower its debt, as it was in a negative cash position of CNY 12.96 billion as of June 30, 2018.
Jiangsu Shunfeng Photovoltaic holds Shunfeng International’s solar cell, module and panel manufacturing activities, a business dealing with the construction, operations and sale of solar power plants in Europe and Japan, and its plant management services, mainly performed by its German-based unit Solarstorm AG. The following table contains more information about the target group’s principal subsidiaries and joint ventures.
|Name||Activity||Place of business||Production capacity/installed capacity|
|Wuxi Suntech||Production and sale of solar cells and modules||Jiangsu, China||Solar cells: 1.8 GWSolar modules: 3 GW|
|Suntech Power Japan Corporation||Sale of solar modules and systems||Tokyo, Japan||N/A|
|Luoyang Suntech Solar Power||Production and sale of solar cells, systems engineering||Henan, China||Solar cells: 400 MW|
|Jiangsu Shunfeng New Energy Technology (51%-owned JV)||Production and sale of solar cells||Jiangsu, China||Solar cells: 1.5 GW|
|meteocontrol GmbH||Solar power plant monitoring, sale of solar power products||Augsburg, Germany||N/A|
|J Energy Power LP||Operation of solar plants||Japan||12.75 MW of solar parks|
|SF SolPower AG||Operation of solar plants||Germany, Switzerland and Czech Republic||8.34 MW of solar parks|
|Changzhou Shunfeng Photovoltaic Materials C||Production and sale of solar wafers||Jiangsu, China||Solar wafers: 500 MW|
As some of the target production assets are currently held by Jiangsu Shunfeng Electricity, another subsidiary of Shunfeng International, those will be moved to a new company called Liyang Shuneng Photovoltaic Power. The particular assets include land, projects and other facilities and will be transferred from Jiangsu Shunfeng Electricity to Liyang Shuneng. Additionally, an equity transfer agreement to move the entire equity interest in Liyang Shuneng to Wuxi Suntech should be signed within 12 months from the creation of Liyang Shuneng.
Following the sale, Shunfeng International will keep its focus on solar power generation in China, including the construction of new facilities, as well as on its LED business.
Shunfeng International initially announced plans to dispose of Jiangsu Shunfeng in October 2018. It then signed a non-binding memorandum of understanding (MoU) with Asia Pacific Resources Development Investment, owned by tycoon Cheng Kin Ming, to sell the entity for CNY 4.7 billion.
(CNY 1.0 = USD 0.149/EUR 0.132)