China's STGCON, German CEO battle for Asola's future

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The insolvent Asola Solarpower has been in search of an investor for some time. pv magazine has learned that negotiations between the Thuringian photovoltaic company and the Chinese investment fund Cowin took place last year with regard to the latter acquiring a stake in the company. A preliminary agreement purportedly aimed in particular at Asola Solarpower’s expertise in the automotive segment was concluded in August 2012. The details negotiated at the time reportedly provided for payment of a double-digit amount in the millions by Cowin, which, in turn, would receive shares in Asola Automotives Solar Deutschland. However, negotiations ended abruptly and the agreement was not realized.

China’s STGCON Group, meanwhile, has now concluded a takeover agreement with Asola Solarpower’s insolvency administrator for the module division. The group plans to completely revamp the Thuringian module manufacturer’s business model as part of the takeover, STGCON’s German subsidiary announced on Tuesday. STGCON plans to establish a European development center for energy storage, energy management and battery charging systems for the stationary and automobile segments at the company’s factory in the city of Erfurt.

The move would involve a transfer of technological know-how and development expertise from China to Erfurt as STGCON aims to incorporate its energy storage and energy management technology into the new development center.

On Monday, the Erfurt Local Court opened separate insolvency proceedings for the group’s debt-ridden Asola Automotive Solar Deutschland GmbH division. The court appointed Erfurt attorney Volker Reinhardt as the company’s insolvency administrator. Asola Solarpower President and CEO Reinhard Wecker, however, had sought to obtain an independent insolvency administrator for Asola’s automotive segment, Wecker told pv magazine. He believes that there are other motives behind the interest expressed by STGCON than those made public.

By purchasing the module segment, the potential investor could be aiming to gain access to Asola’s automotive know-how, according to Wecker. This would also explain why the module manufacturer’s production has been suspended since January.

On Tuesday, STGCON Germany released a statement denying rumors that Asola Solarpower’s module production would be relocated from Thuringia to China. On the contrary, STGCON plans to purchase the required solar modules from external suppliers via Croatia in the future and then to sell them under the Asola label. By the end of June several Chinese photovoltaic manufacturers were supplying their modules to Croatia in order to be able to deliver them to other European markets after Croatia became a member of the EU at the beginning of July.

German daily Thüringische Allgemeine reported that Thuringia’s economics minister Matthias Machnig only recently recommended that the works council examine the agreement between the investor and the insolvency administrator with regard to employment and site guarantees. Moreover, the Ministry of Economic Affairs will demand repayment of approximately €1.8 million ($2.3 million) in subsidies should production be stopped. The newspaper goes on to report that a top employee at Asola Automotive has meanwhile reemerged as a manager at STGCON Germany. Although he had only been briefly employed at Asola, he took part in the contract negotiations. Now he is in line to take the reins at a resurrected Asola Solarpower on behalf of STGCON.

Wecker, meanwhile, is currently focusing on saving at least Asola’s automotive segment. Promising discussions are being held with an investor from Germany, he told pv magazine. He aims to thwart any transfer of know-how to China and to preserve jobs at the company’s location in Erfurt.

Reinhardt, Asola Solarpower Automotive’s insolvency administrator, was not available for comment.

Translated by Alan Faulcon