US$2 billion in equipment contracts lapse at Hanergy

The last six months have not been good to Hanergy. The soaring of the company’s stock price during the spring came to an abrupt halt and collapse following company chairman and major shareholder Li Hejun’s absence from its annual meeting in May.

Beginning in July, Hanergy has had its stock frozen on the Hong Kong Stock Exchange amid an ongoing investigation by regulators and has cancelled a number of orders from its subsidiaries. In August the company announced that it would cut 2,000 jobs under a restructuring plan, and its deputy chairman resigned in September.

Today Hanergy announced that two external orders for 1.8 GW of equipment to make thin film building integrated PV modules had lapsed, via notices (here and here) on the Hong Kong Stock Exchange. The reason given for the cancellation of the two orders is that the purchasing companies had not yet paid 80% of the purchase price, which totaled nearly US$2 billion.

Purchasers Inner Mongolia Manshi Investment and Baota Petrochemical Group were to further receive a combined total of 4.1 billion new Hanergy shares, and this transaction has also been cancelled.

During the first six months of 2015 Hanergy reported a 34% year-over-year fall in revenues to US$274 million, as well as a loss of $10.4 million, a sharp reversal fro the healthy profits it had previously recorded.