PV project developer, SPI Solar, has completed its second private placement of shares to generate another US$21.75 million in new funding, just two weeks after its first private placement.
China-based integrated PV manufacturer, LDK Solar, which has its registered base in the Cayman Islands and currently undergoing bankruptcy proceedings, as well having its ADS shares delisted from the NYSE is the majority owner of SPI Solar.
SPI Solar was also separately delisted and trades on the OTC market as does LDK Solar’s ADS’.
The PV project developer recently signed a 50MW PV power plant project agreement with the Chinese provisional government of Fenyi County, Jiangxi Province that was rapidly sold to Xinyu Zhongzhi Guoxiang New Energy Electric Power Investment Development for an undisclosed sum ahead of the project being built.
Xinyu Zhongzhi has also signed an EPC contract with Xinyu Xinwei, SPI Solar’s China-based PV construction arm for a 21MW project in Jiangxi Province.
SPI Solar said that the proceeds of the latest private placement of shares to unidentified investors would be used to “expand its global PV project activities, continued investment in ramping its YES! Solar solution for the residential and small business segments, for working capital purposes and to pay down debt.”
SPI Solar’s YES! Solar solution includes LDK Solar modules and a dealer/installer financing package targeted at commercial and residential markets in the US.
“We are pleased to announce this significant capital raise for SPI,” said Xiaofeng Peng, Chairman of SPI. “Combined with our other recently closed private placement for $21.75 million, consummation of this private placement will dramatically strengthen SPI's financial position to capitalize on opportunities we are currently seeing across the global PV project landscape.”
Peng is also the founder and Chairman of LDK Solar.
Under the terms of the purchase agreement, SPI Solar is issuing 92,620,000 shares of common stock at a price of US$0.27 per share to raise net proceeds of US$21.75 million. The shares were said to have been offered and only sold to non-US investors.
Zheng Jianming a Hong Kong based property tycoon owns a stake in LDK Solar and is the owner of PV project developer Shunfeng, which now owns PV manufacturer, Wuxi Suntech, formerly the manufacturing arm of the once leading PV manufacturer, Suntech Power Holdings, which is also undergoing bankruptcy proceedings in the Cayman Islands.
Rumours have circulated throughout 2014 that an investment arm of Zheng Jianming’s empire would finally secure a majority ownership of LDK Solar’s China assets that include polysilicon production through to module assembly, ultimately combining the manufacturing assets of Wuxi Suntech and LDK Solar under the auspices of downstream project developer Shunfeng.
Recently, Eric Luo Chief Executive Officer of Wuxi Suntech had been re-designated from a non-executive director of Shunfeng to an executive director of the company.
The US$50 million in fund raising by an OTC company specialised in PV project development activities could be viewed as unprecedented, especially considering its recent financial collapse caused by its majority shareholder’s financial malaise.