By Karl-Erik Stromsta in London
Friday, March 14 2014
Last year, when Hong Kong-listed Shunfeng revealed its intention to buy insolvent Wuxi Suntech for 3bn yuan ($490m), it pledged to publish by 20 February at the latest a “circular” for its shareholders, which must still approve the acquisition at an extraordinary general meeting.
On 20 February, however, Shunfeng said that it needed additional time to “finalise the contents of the circular”, claiming that it would be published “on or before” 13 March.
Shunfeng has once again missed its deadline, giving itself another week – until 21 March – to publish the circular.
The circular is meant to contain in-depth details of the acquisition, including the restructuring plan underway within Wuxi Suntech and how its integration into Shunfeng will affect the broader company’s financial position.
Adding to the sense of unease surrounding the company, Shunfeng on 28 February warned its shareholders to expect a “significant increase” in its 2013 losses, with its final 2013 financial report due by the end of March.
Some industry observers will see the Wuxi Suntech acquisition as having been complicated by the ongoing legal actions of Suntech Power Holdings – most notably the $264m legal victory it claimed last month to have won against Suntech Singapore, a unit of Wuxi Suntech, in a Singapore court.
However, speaking recently to Recharge, Eric Luo, chief executive at Wuxi Suntech since January, insisted that the acquisition remains on track – claiming that as a listed company Shunfeng is merely being forced to jump through the normal hoops.
Wuxi Suntech was the key operating subsidiary of Suntech Power Holdings, and was forced into insolvency in China last spring after its parent company defaulted on its bonds.
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