The Singapore subsidiary of global solar power company Suntech Power Holdings Co., Ltd. has been deemed unable to pay its debts under a Singapore Companies Act following a failure to settle an outstanding $263.9 million owed to one of its subsidiaries, Power Solar System Co., Ltd (PSS).
The liquidator of PSS issued a statutory demand for the judgment debt on February 20 after an earlier order from the High Court of the Republic of Singapore ruled that Suntech Singapore must pay the outstanding monies.
The payment deadline March 13 has now passed, and with no monies yet forthcoming the company has now been judged unable to satisfy its creditors.
PSS has also undertaken second action against Suntech Singapore, filing a civil complaint with the Shanghai No.1 Intermediate People’s Court (PRC Court) for an outstanding principal amount of $11 million and all overdue interest. This complaint was accepted by the PRC Court last month, and with a hearing fixed for November, the PRC Court granted a one-year onshore asset preservation period against Suntech Singapore, effectively freezing its equity interest.
"We will rigorously defend the application by Suntech Singapore to set aside PSS judgment for the sum of $262.9 million, and will take all necessary steps to recover value for creditors," said PSS liquidator John Ayres. "We are also making substantial progress in the investigation of the purported transfer of the equity interests in Suntech Power Japan and Suntech Singapore to Wuxi Suntech Power Co., Ltd.
"These actions appear to have been taken without proper regard for the interests of creditors and shareholders of the company, and appropriate actions will be taken in due course," added Ayres, who in February first announced his intention to investigate the aspects of the Shunfeng acquisition.