Hongyuan Green Energy plans to invest 630 million yuan in the restructuring of Wuxi Suntech, a former photovoltaic leader with total liabilities reaching 4.5 billion yuan | Brief Announcement

Reprinted from: Cailian Press

Cailian Press, March 25 — (Reporter Liu Mengran) Hongyuan Green Energy (603185.SH) has preliminarily revealed its participation in the restructuring plan of Wuxi Suntech. Tonight, Hongyuan Green Energy announced that its controlling subsidiary, Hongyuan Photovoltaic, will jointly establish a new company, New Suntech, with Wuxi Suntech. The registered capital of New Suntech is 1 billion yuan. Hongyuan Photovoltaic will contribute 630 million yuan to hold approximately 63% of New Suntech’s equity and will lead an investment consortium to introduce other investors.

This means that Wuxi Suntech, once a leading photovoltaic module manufacturer, has experienced ups and downs. Although it still faces insolvency, there is finally hope for a “rebirth.” After the establishment of New Suntech, once the court approves the restructuring plan, it will pay Wuxi Suntech 142 million yuan in restructuring investment, of which 50 million yuan has already been paid into the administrator’s account as an investment guarantee deposit.

According to the announcement, this payment will mainly be used to acquire core assets necessary for Wuxi Suntech’s operations, including some subsidiary equity, trademarks related to the Suntech brand, patents, and other intellectual property rights. It will also cover bankruptcy costs, common benefit debts, employee claims, relevant taxes and fees, and debt repayment expenses.

Wuxi Suntech was established in 2001 and was once a globally renowned photovoltaic module manufacturer. After listing on the NYSE in 2005, it enjoyed great success, but due to industry cycle fluctuations and management decisions, it filed for bankruptcy restructuring in 2013, with Shunfeng Photovoltaic taking over.

Previously disclosed information shows that on May 26, 2025, the People’s Court of Xinwu District, Wuxi City, ruled to initiate pre-restructuring procedures for Wuxi Suntech, which was later extended. Hongyuan Green Energy’s involvement marks its second key investment in Wuxi Suntech’s bankruptcy restructuring.

As a company involved in the upstream and downstream of the photovoltaic industry chain, Hongyuan Green Energy mainly operates in photovoltaic modules and silicon wafers. Its participation in Wuxi Suntech’s restructuring is seen as an important move to improve its industrial chain layout and expand brand channels. Wuxi Suntech still maintains high brand recognition globally, with sales covering over 100 countries and regions, especially strong in the European market.

Although Wuxi Suntech’s brand and channel value remain, Hongyuan Green Energy faces significant financial pressure to acquire these assets. As disclosed today, as of May 26, 2025 (the date the court accepted Wuxi Suntech’s pre-restructuring), Wuxi Suntech’s audited total assets are 537 million yuan, total liabilities are 4.578 billion yuan, and net assets are -4.041 billion yuan.

Regarding its participation in Wuxi Suntech’s restructuring, Hongyuan Green Energy stated that it is a response to the national resource integration call, combined with its own operational improvement trend and Wuxi Suntech’s brand value, technological accumulation, and customer resources. The company plans to achieve coordinated development through future integration of both parties’ advantages.

It is worth noting that Hongyuan Green Energy has also faced industry downturn pressures in recent years. According to its January earnings forecast, it expects a net profit attributable to the parent company of 180 million to 250 million yuan in 2025, but its non-recurring net profit will still be between -250 million and -310 million yuan. During the reporting period, the company transferred part of its equity in Inner Mongolia Xinyuan Silicon Materials Technology Co., Ltd., which will increase its consolidated profit by approximately 291 million yuan in 2025.

Regarding the reasons for the performance changes, Hongyuan Green Energy stated that the contradiction of phased overcapacity and supply-demand mismatch will persist in 2025. Product prices across the industry chain remain under pressure, especially with a significant increase in silver paste prices in the fourth quarter, which has increased production costs for some of the company’s products and added operational pressure. However, the company’s asset-liability ratio has remained below 60% for a long time, maintaining good risk resistance.

(Cailian Press, Liu Mengran)