ReneSola to sell all shares in solar manufacturing business to CEO


ReneSola has confirmed today that its CEO, Xianshou Li, will purchase 100% of the company solar manufacturing and LED division shares as part of a restructuring procedure for the struggling Chinese solar firm.

The share purchase and subscription agreement (SPA) will transfer a total of RMB 3 billion ($452,430 million) in debts to Li via ReneSola Singapore Pte Ltd, thus removing from ReneSola’s books its most debt-heavy business.

The company said that this agreement will form part of an ongoing restructuring of the business that will allow ReneSola to focus more on asset-light and high-margin project operations.

Following the deal, ReneSola’s immediate liability and other short-term debt will be reduced to a more manageable $217.3 million.

Maggie Ma, the finance head of ReneSola, said that the agreed transaction will help to alleviate the firm’s going-concern and de-listing risk. In August ReneSola first revealed that it may be forced to sell off its indebted polysilicon, wafer  and PV production business in order to regain compliance with the listing standards of the New York Stock Exchange (NYSE).

This SPA strategy followed by ReneSola has already been executed this year by Trina Solar, which went private following the sale of its shares to CEO and chairman Jifan Gao.

For ReneSola, added Ma, it is hoped that the agreement is “a truly transformative transaction that will offer the company and its shareholders significant value from a new asset-light business model, a stronger balance sheet, and higher valuation multiples.”

In the first quarter of the year ReneSola recorded a net loss of $23.2 million, with revenue down 39.9% year-on-year to just $156.6 million. The company is currently in the throes of refocusing its primary market downstream, building up a pipeline of 1.4 GW of projects by the end of June.

ReneSola has scheduled a business update and financial results conference call for Wednesday September 27.

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