The auction of the insolvent Solar Millennium AGs two biggest projects took place late this month, as part of the companys Chapter 11 bankruptcy proceedings. U.S.-based NextEra has subsequently taken over the one GW Blythe solar project, and BrightSource, the 500 MW Palen project.
At the auction, a total of US$80 million was received for the projects. However, in a statement released today, Solar Millennium said that a portion of the purchase price will only be paid upon the completion of certain "project milestones". It is expected that the implementation of the sale will take place in either July or August, depending on the occurrence of certain closing conditions.
The statement added that whether or not Solar Millenniums creditors benefit from the purchase price is dependent on which of the pending U.S. insolvency claims are recognized by the responsible U.S. court. The achieved purchase price will reportedly initially cover the costs of proceedings and the satisfaction of certain privileged debts in the U.S., where some claims have not yet been decided.
However, in the course of the sale of Solar Millennium, appointed insolvency lawyer, Volker Böhm, could achieve, during negotiations with bidders and the American creditors committee, the replacement of project related guarantees, which have not yet been claimed. In doing this, Böhm says that in the short term this would lead to a cash benefit of millions of dollars for the creditors of Solar Millennium.
Under Chapter 11, an auction is an option for recovery. A previous attempt to sell the companys shares to Germanys solarhybrid AG, failed. The statement added that an investor process is still ongoing for the remaining two projects, the 500 MW Amargosa plant and Ridgecrest.
Last August, it was announced that the first 500 MW phase of the one GW Blythe solar project would use photovoltaic technology instead of the previously planned concentrated solar power. Prior to this, the plant had received a US$2.1 billion loan guarantee. Construction was said to have begun last June.
Regarding the Palen project, it is expected to use parabolic solar technology and will comprise two adjacent, independent, and identical solar plants worth a total of 500 MW. Solar Millennium, LLC and Chevron Energy Solutions were originally the joint developers.