Suntech Power

Suntech Power Holdings Co., Ltd.
Public
Traded as OTC Pink: STPFQ
Industry Photovoltaics
Founded September 2001
Founder Shi Zhengrong
Headquarters Wuxi, Jiangsu, China
Number of locations
 United States, Germany, Switzerland, Japan, Australia, Italy, Spain
Revenue Increase US$3.15 Billion (FY 2011)[1]
Decrease -US$616 Million (FY 2011)[1]
Decrease -US$1.00 Billion (FY 2011)[1]
Total assets Increase US$2.09 Billion (FY 2011) [2]
Total equity Increase US$946 Million (FY 2011)[2]
Parent Shunfeng International Clean Energy Limited
Website www.suntech-power.com/

Suntech Power Holdings Co., Ltd. (Chinese: 尚德; pinyin: Shàngdé) is a Chinese producer of solar panels, with 2,000MW of annual production capacity by the end of 2011. It is headquartered in Wuxi, Jiangsu. Shunfeng International Clean Energy Limited, a HKSE listed renewable energy investment and Independent Power Producer company, acquired Suntech in 2014 following Suntech's bankruptcy in 2013.[3] With offices or production facilities in every major market, Suntech has delivered more than 13,000,000 solar panels to thousands of companies in more than 80 countries around the world.[4] As the center for the company's global operations, Suntech headquarters, in Wuxi, China, features the world's largest building integrated solar facade.[5]

Suntech's fortunes have declined significantly since its peak in 2008, due to a glut in the market for solar products and problems with its investments. In March 2013 it announced a US$541 million bond payment default, becoming the first company from mainland China to default on its US bonds.[6][7] Chinese banks subsequently filed to place Suntech’s main unit, Wuxi Suntech Power Holdings Co., Ltd., into insolvency.[8][9] The company's American Depository Receipts were subsequently delisted from the New York Stock Exchange and placed on the over the counter (OTC) exchange.

Global operations

Suntech Power has representative offices in China, Australia, the United States, Switzerland, Spain, Italy, Germany, Japan, and Dubai, as well as production facilities in Wuxi, Luoyang, Qinghai, Shanghai, Germany, Japan, and Goodyear, Arizona.

Suntech America is based in San Francisco, California, and the company has plans to start a production facility in Phoenix, Arizona in 2010.[10] Suntech also has executives of their US operations in top posts in American solar panel industry groups.[11]

Installations

Suntech Power has supplied or installed solar modules for numerous solar power plants and systems around the world. Notable installations include:

The company's Suntech Energy Solutions division completed Google's 1.6 MW solar installation in June 2007.[12]

Suntech Power joined with Israeli company Solarit Doral to build a 50 kW rooftop project in the Israeli settlement of Katzrin in the Golan Heights, which was connected to the electricity grid in December 2008.[13][14]

Suntech panels were used on the Ketura Sun field, the first commercial solar field in Israel. The field was developed by the Arava Power Company.

In 2010, Suntech topped the solar panel shipment with 1.49GW shipment volume, according to PVinsights. Suntech targets to ship over 2GW in 2011; however, free price fall for solar components in 2011 made this more difficult to achieve. During the downturn of solar panel price, Chinese companies showed their ability to compete in cost management.

On the very first day of the third quarter in 2011, SunTech announced that they would terminate their long-term wafer contract with MEMC by paying US$120 million.[15]

Market share of the top five Chinese solar companies ranked in 2011, which are Suntech, Yingli, Trina, Canadian and Jinko, made a huge advancement from 17.2% market share in 2009 to 30% market share in 2011. The five Chinese solar module companies almost doubled their totaling market share in 2.5 years and took nearly one-third of the worldwide market.

Suntech announced in 2013 that it will be closing its Goodyear, AZ panel manufacturing plant. The reason given for the closure was the hefty tariffs imposed on Chinese solar cells by the United States International Trade Commission, even though the panels were assembled in Arizona, the cells were actually produced in China.[16]

Awards

Suntech Power was recognized as the 2008 Frost & Sullivan Solar Energy Development Company of the Year. Frost & Sullivan Research Analyst Mary John commented on the recognition, "The company's pioneering success in developing energy-efficient, cost-effective and customizable building integrated photovoltaic (BIPV) systems and crystalline PV cells, and modules for solar energy conversion into electricity are highly commendable. It has gone beyond just meeting global energy needs to anticipating them as well and highly satisfied customers testify that the BIPV systems and other energy-efficient products are customized precisely to their needs."[17]

The Andalay AC Solar PV Panel was awarded one on MSN’s most brilliant products of 2009 because of innovations that advanced their ease of installation and use.[18] Suntech Power is one of the main manufacturers of components for the Andalay Solar Panel sold by Akeena Solar (AKNS).[19]

Founder

Dr Shi Zhengrong (born c. 1963[20]) is the founder,[21] chairman and chief executive officer of Suntech Power.

He is a graduate of the University of NSW's School of Photovoltaic and Renewable Energy Engineering.[22][23] At UNSW, Dr. Shi studied under Professor Martin Green and met Stuart Wenham, now Suntech's Chief Technology Officer.

Dr. Zhengrong Shi was honored in January 2010 as a finalist for the Zayed Future Energy Prize. In 2007, Dr. Shi was named one of Time Magazine's Heroes of the Environment. He is often referred to as the world's first 'green billionaire'.[24]

Dr. Zhengrong Shi has been appointed Visiting Professor at the University of NSW.

Investments

Before going public on the NYSE in 2005, Suntech was funded by a consortium of private equity firms, including Actis Capital and Goldman Sachs. The consolidated private equity investment into Suntech is generally considered to be one of China's most profitable private equity investments ever, as each firm is thought to have made gains well over 10x on their original investments. The company's stock performed quite well after its first day of IPO on Dec 14th, 2005.[25]

GSF became biggest partner[26] of Suntech and in 2010, almost all the international sales were through GSF. In June 2008, Suntech invested into their biggest partner, Global Solar Fund (GSF), a company investing in power plants in Spain and Italy. In May 2010, Suntech guaranteed a finance arrangement of 554.2 million euro provided by China Development Bank to companies related to GSF, using 560 million euros in German government bonds from GSF Capital as collateral. There was no issue related with transparency and GSF was wrongly blamed for failure of Suntech (evident from Earnings call, Chairman comments[27]) However, on 30 July 2012 Suntech revealed that the bonds didn't exist, they were apparently forgeries. In the following week, Suntech shares lost 40% of their value.[28][29]

Bankruptcy

Solar Industry[30] suffered from over capacity and was not able to generate enough cash to pay for the debt repayments. Suntech shipped 46% [31] higher volumes and predicted the problems in 2010-11,[32][33] due to increased competition and lower margins. Suntech was not the only Chinese company, other also faced similar pressures.[34]

As a result, Suntech, defaulted on $541 million of convertible bonds in March 2013.[35] On March 20th, 2013 the main subsidiary of Suntech filed for bankruptcy in Jiangsu, China.[36] In February 2014, Suntech filed for Chapter 15 bankruptcy in Manhattan, New York to seek protection from U.S. creditors.[35] A creditors’ working group led by distressed debt funds Clearwater Capital Partners LLC and Spinnaker Capital Ltd. announced in August a plan to recapitalize the solar maker, the company said in a statement.[35]

See also

References

  1. 1 2 3 Suntech's annual income statement via Wikinvest
  2. 1 2 Suntech's annual balance sheet via Wikinvest
  3. ↑ Suntech Press Release, 2014
  4. ↑ "Suntech - About - Investors - Press Releases". Ir.suntech-power.com. 2011-02-28. Retrieved 2014-03-24.
  5. ↑ Archived January 17, 2009, at the Wayback Machine.
  6. ↑ Alex Morales & Christopher Martin (2013-03-18). "Suntech Defaults on $541 Million Bond, a First for China". Bloomberg.
  7. ↑ "Suntech announces default, search for financing". The Sydney Morning Herald.
  8. ↑ Ehren Goossens & Justin Doom (2013-03-21). "Biggest Solar Collapse in China Imperils $1.28 Billion: Energy". Bloomberg.
  9. ↑ Wee, Sui-Lee (2013-03-20). "UPDATE 2-Solar pain hits China as Suntech unit nears insolvency". Reuters.
  10. ↑ "Suntech - About - Investors - Press Releases". Phx.corporate-ir.net. Retrieved 2014-03-24.
  11. ↑ Retrieved November 12, 2009, from Solar Energy Industries Association: About: SEIA Board website: http://www.seia.org/cs/seia_board
  12. ↑ Google Solar Panel Project Archived February 12, 2009, at the Wayback Machine.
  13. ↑ Israel opens largest solar plant with Chinese help, December 10, 2008.
  14. ↑ Chinese PV pioneer helps build Israel's biggest solar power station, Xinhua, December 9, 2008.
  15. ↑ "MEMC, Suntech terminate wafer supply deal". Eetimes.com. Retrieved 2014-03-24.
  16. ↑ Bingham, Matt; Lewis and Roca LLP (March 19, 2013). "Suntech Closing Goodyear Solar Plant; Blames U.S. Solar Tariff". The National Law Review. Retrieved April 21, 2013.
  17. ↑ "Frost & Sullivan Recognizes Suntech Power for Its Technical Expertise With Low Cost, High Quality Products for Solar Energy Markets - Business News". redOrbit. 2008-04-15. Retrieved 2014-03-24.
  18. ↑ MSN Tech and Gadgets. 10 Most Brilliant Products of 2009. Retrieved November 12, 2009, from MSN website: http://tech.msn.com/products/slideshow.aspx?cp-documentid=22104619&imageindex=6
  19. ↑ Google Finance. Akeena Solar, Inc. (Public, NASDAQ:AKNS). Retrieved November 12, 2009, from Akeena Solar Inc. company profile website: https://www.google.com/finance?q=NASDAQ:AKNS
  20. ↑ The alternative rich list. September 22, 2006. Accessed May 7, 2007.
  21. ↑ Archived March 12, 2008, at the Wayback Machine.
  22. ↑ "School of Photovoltaic and Renewable Energy Engineering". Pv.unsw.edu.au. Retrieved 2014-03-24.
  23. ↑ Dr. Zhengrong Shi Archived October 20, 2007, at the Wayback Machine.
  24. ↑ Green, Martin (2007-10-17). "Shi Zhengrong - Heroes of the Environment". TIME. Retrieved 2014-03-24.
  25. ↑ "China's Suntech shines in solar IPO". Dec 15, 2005. Retrieved Jul 26, 2013.
  26. ↑ http://www.suntech-power.com/news/news73.html
  27. ↑ http://www.123jump.com/transcripts-calls/Suntech-Power-Q3-2009-Earnings-Call-Transcript/35492/421
  28. ↑ "Suntech Probes Potential Fraud on $680 Million Guarantee". Bloomberg. 2012-07-30.
  29. ↑ "Italian road to China's Suntech fraud was paved with warnings". Reuters. 2012-08-06.
  30. ↑ https://www.theguardian.com/sustainable-business/2016/jan/31/solar-power-what-is-holding-back-growth-clean-energy
  31. ↑ https://www.greentechmedia.com/articles/read/suntech-predicts-50-percent-groth-in-shipments-in-2011
  32. ↑ http://www.suntech-power.com/news/news69.html
  33. ↑ http://www.prnewswire.com/news-releases/suntech-announces-full-year-2010-and-2011-guidance-and-joint-venture-to-expand-pv-cell-capacity-111375829.html
  34. ↑ http://www.ibtimes.com/chinese-solar-panel-companies-faced-overcapacity-low-demand-eu-tariffs-are-facing-1305933
  35. 1 2 3 "Suntech Seeks New Cash After China Bankruptcy, Liquidator Says". Bloomberg. 2014-04-29.
  36. ↑ "Chinese Subsidiary of Suntech Power Declares Bankruptcy". New York Times. 2013-03-20.
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