The Munich District Court opened insolvency proceedings for German solar developer, Phoenix Solar AG on Tuesday and appointed lawyer Michael Jaffé as insolvency administrator. Jaffé had previously been appointed as provisional insolvency administrator of the Munich-based company.
In a report, he draws a bleak picture for the corporation. “The assets of Phoenix Solar AG mainly consist of investments in the non-insolvent subsidiaries in the Asia-Pacific region, in Italy, in Greece and in the Middle East. The negotiations with potential investors are under way for this. However, the outcome is still uncertain,” said Jaffé in his report. “In all likelihood, however, the proceeds from realization will not be reasonably sufficient to cover the due liabilities of Phoenix Solar AG.”
Phoenix Solar AG acted as the financial holding company for its globally active subsidiary companies. For the 13 employees in Sulzemoos, Bavaria, insolvency money expires at the end of the month, but normal business operations have already come to a standstill, as a spokesperson for the law firm explained to pv magazine.
“Germany was in the past few years anyway only a peripheral area for Phoenix Solar,” the spokesman stressed. Accordingly, Europe, including Germany, contributed a total of only 0.8% to Group sales in 2016, with most of the company’s revenue still being generated in Italy. Until 2012, during the booming phase of the local PV market, the group still generated the majority of its sales in the trading business in Germany.
The Group’s turnover for 2016 came 78% from the U.S., where it generated sales to the tune of €107 million.
Phoenix Solar AG filed for insolvency on December 13, 2017, after a large customer of the U.S. subsidiary had drawn project-related letters of credit amounting to approximately $8 million. According to the spokesperson, about 50 of the 120 employees in the group worked for the US subsidiary Phoenix Solar Inc.
It filed for bankruptcy under Chapter 7 of the US Bankruptcy Code on December 28, 2017, after customers had previously canceled important orders. For the U.S. subsidiary, there is no continuation solution, according to the announcement.
“The subsidiaries are of interest to strategic investors who, in conjunction with their own projects, are looking for an established unit and can leverage appropriate synergies,” Jaffe explained.
The most promising is the sale of the company’s stake in solar park in Sicily. Numerous discussions with several potential buyers have already been conducted, and the first purchase offers are in the pipeline. This also applies to the company’s interest in a PV system in Waltenhofen, Germany.
As for the subsidiaries of Phoenix Solar in the Asia-Pacific region, a contract with one of the interested potential investors may be closed soon. Also for the subsidiaries in Turkey and in Oman, negotiations are still being held with potential interested parties, whereby conditions are considerably more difficult.
The insolvency administrator is further considering options for the subsidiary in Greece (Phoenix Solar M.E.P.E., Athens). According to him, potential investors have also expressed interest in the extensive trademark rights of Phoenix Solar AG.