Suntech Singapore $264m court twist
A Singapore court has ordered Suntech Singapore – which is being bought by Shunfeng – to pay former owner Suntech Power Holdings some $264m, throwing another wrench into Shunfeng’s still-unfolding acquisition of Wuxi Suntech.
Suntech Power Holdings, the rump of the once-mighty Suntech empire, says that on 27 January the High Court of Singapore granted a Judgment in Default of Appearance against Suntech Singapore for the full amount it had demanded – some $264m plus costs, with interest set at 5.33%.
Suntech Singapore had not appeared to contest the claims, Suntech Power Holdings says.
Suntech Singapore was owned by a subsidiary of Suntech Power Holdings until it was ostensibly bought by Jiangsu Shunfeng Photovoltaic, as part of Shunfeng’s blockbuster but as-yet-unfinished acquisition of Wuxi Suntech, the manufacturing unit of Suntech.
Suntech Japan, another valuable subsidiary, was also ostensibly included in that deal, although many of the details of Shufeng’s acquisition remain in dispute.
The ruling in Singapore is “the first of many steps” being taken by Suntech’s liquidator to “maximise the recovery for the creditors”, says John Ayres, liquidator for Power Solar System, the bankrupt subsidiary of Suntech Power Holdings that owned Suntech Singapore.
Ayres says the next step will be an “investigation” of the “purported transfer” of Suntech Japan and Suntech Singapore to Wuxi Suntech Power before it was sold to Shunfeng.
Shunfeng has said it intends to finalise its 3bn yuan ($500m) acquisition of Wuxi Suntech by the end of February, although its plans may yet be delayed or blown off course by the litany of ongoing litigation surrounding Suntech and its former subsidiaries.
Shunfeng is not seeking to acquire the well-known Suntech brand, but is focused only on its manufacturing assets, as it plans to transform into one of the world’s largest PV module makers and downstream installers, akin to First Solar.
Suntech Power Holdings has been declared bankrupt in mainland China, and reports recently emerged that the company will soon file for Chapter 15 bankruptcy protection in the US, where holders of more than $500m worth of unpaid convertible bonds are looking for repayment.