Shunfeng Photovoltaic is planning to place a 10-year convertible bond valued at HK$3,580,000,000 (US$461.77 million) with selected investors to pay for the US$492.3 million acquisition of Wuxi Suntech via court administrators in China.
The largest purchaser of the planned bond, which will carry zero interest payments, is a private investment firm, Peace Link, a wholly owned subsidiary of Faithsmart, which is itself wholly owned by Cheng Kin-ming, the largest shareholder in Shunfeng as well as a major shareholder in LDK Solar and which has business dealings with Hareon Solar Technology.
Another investor via the bond is Coherent Gallery International, wholly owned by Tang Guoqiang, a former non-executive director of Shunfeng and a previous major shareholder in the company.
Initially, Shunfeng had planned to meet Wuxi Suntech administrators' demand for US$410 million within the first month of the acquisition through a personal agreement with Cheng Kin-ming.
However, Shunfeng said in a statement that issuing the convertible note was in the best interest of existing shareholders.