Suntech board reshuffle ‘unlawful’, says outgoing Chairman

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on reddit
Reddit
Share on email
Email

Dr Zhengrong Shi has called Suntech Power Holdings’ decision to remove him as Executive Chairman of the board “misconceived” and “unlawful”.

This week, the Chinese module manufacturer appointed Susan Wang as Chairwoman of its board of directors, replacing Dr Zhengrong Shi who has been demoted to board director level.

Dr Shi said in a statement that the Suntech board had “no legal basis” for removing him and that the decision was “invalid and of no effect”.

“The actions taken at this time by the rest of the board show that they are not focused on the issues most important at hand and are not acting in accordance with the best interest of the company,” he said.

“I will take all steps necessary to protect the company from being harmed by unlawful actions such as the above. I am fully committed to continuing to serve the company as Executive Chairman to the best of my ability and to guide it through these difficult times.”

In response, Suntech said it was “confident its appointment of Susan Wang is valid and effective by law”.

Speaking separately to Bloomberg, Dr Shi is claimed to have said that Suntech’s Board has no plans to refinance the US$541 million convertible bonds due 15 March.

In October last year, Suntech employed UBS Investment Bank to find alternative ways to avoid defaulting on the buyback of bonds. At the end of the first quarter of 2012, Suntech had short-term bank borrowings of US$1.55 billion but had short-term credit facilities valued at US$3.9 billion, of which US$1.75 billion had been drawn down.

“The problem is they don’t have a solution,” said Dr Shi told Boomberg. “They need a viable business plan. They need to talk to all the bondholders and suppliers and government. All the stakeholders want to talk to me. All the bank CEOs want to talk to me. They want to know why Dr Shi didn’t show up [to meetings].”

He added: “I have good terms with all stakeholders, including the government, banks and suppliers,” he said, adding that after his removal was announced “banks started to worry that the company was going into bankruptcy”.

Dr Shi said he was unaware as to whether his removal was related to the bond payment due this month.

A spokesman for Suntech said the company was not commenting further on the bonds.

Nitin Kumar, Analyst at Nomura Singapore, told Bloomberg: “Our best guess is that Suntech is preparing for ceding control to a third party. Management change at Suntech was sorely needed given the execution missteps over the last five to six years.”

Last summer an Italian court had reportedly filed a lawsuit against the company’s Global Solar Fund (GSF). The lawsuit alleged that the investment fund illegally built solar farms in the country in order to exploit Italy’s subsidies.

If convicted, the charges may lead to the removal of €80 million worth of subsidy-backed solar farms, an Italian prosecutor said as cited by Reuters.

According to a Reuters article at the time, since this discovery on 30 July, Suntech had lost more than 40% of its market value.

Furthermore, Schott Solar Wafer filed a lawsuit in December 2012 against Suntech for breaching a long term supply agreement. Schott Solar is demanding €13.6 million (US$18 million) to compensate for the supply of 220MW of multicrystalline wafers per annum to Suntech.

One bit of good news for Suntech was the threat of delisting from the New York Stock Exchange was averted after its stock price regained compliance in January this year.

1 December 2021
Join this virtual conference on 1-2 December 2021 for expert presentations covering PV Module Technology, Supply & Site Optimisation for Utility-Scale. Delegates can access streamed presentations, session recordings and chat/messaging tools to connect with fellow delegates and speakers. Speakers include leading developers, manufacturers, testing and research institutes, including: NREL, Silicon Ranch, Sonnedix, Heliene, Powertis, LONGi Solar, JinkoSolar, PVEL, Risen Energy, Seraphim, STS, Trina Solar, Eternalsun Spire, QEERI, Fraunhofer, Estuary Capital Partners, VDE, First Solar, Longroad Energy, Powertis and DNV Energy Systems
2 December 2021
Intersolar is the world’s leading exhibition & conference series for the solar industry. As part of this event series, Intersolar India in Mumbai is India’s most pioneering exhibition and conference for India’s solar industry. It takes place annually and has a focus on the areas of photovoltaics, PV production and solar thermal technologies. Since 2019, Intersolar India is held under the umbrella of The smarter E India – India’s innovation hub for the new energy world.
9 December 2021
The Smart Energy Council is hosting Australia’s second Virtual Smart Energy Conference and Exhibition on Thursday, 9 December 2021. This event will show that the industry powers on despite COVID-19 and we are standing together undeterred in spirit. Bringing our global community together using the latest technology.
13 January 2022
Intersolar North America and Energy Storage North America “Come Together” for the first time in Long Beach, CA—connecting installers, developers, utilities, technology providers, policy makers, and key stakeholders from around the world to advance the clean energy future. With best-in-class conference programming, integrated exhibits and pavilions, and the live Solar Games installer competition, #isnaesna21 will showcase the industry trends, innovative solutions, and emerging talent transforming the solar, energy storage, and e-mobility markets. Register today to redeem our exclusive offer for PV Tech readers—free expo hall or 20% off full conference pass.
1 February 2022
As Solar Finance & Investment enters its ninth year, we sit on the cusp of a new power market with solar at its heart. The 2022 edition of the event will build on our years of expertise and relationships to bring investors and lenders together with top developers. Connect with leaders in the field and use exclusive insights to drive investment and development decisions for the future. Meet new and existing project partners at the largest gathering of European solar investors and lenders.
23 February 2022
Held annually since 2016, the Energy Storage Summit Europe is the place to be for senior stakeholders in the European storage industry. Designed to accelerate deployment of storage, we examine evolving chemistries, business models, project design, revenue stacks and use cases for storage. The 2022 edition will include exclusive content around longer duration solutions, energy strategies for wide-scale deployment of EVs and "EnTech", the event which sits at the intersection of digitisation, decentralisation and decarbonation of the power system. Come to meet TSOs, DSOs, Utilities, Developers, Investors and Lenders and leave with new contacts, partners and a wealth of information.

Read Next

November 30, 2021
Solar EPC company iSun is investing in US commercial PV project developer Encore Renewable Energy as part of efforts to accelerate its geographic expansion.
November 30, 2021
The CEO of Hevel Group, Igor Shakhray, will leave the company to become CEO of Unigreen Energy, a silicon wafer and cell manufacturer, which is owned by Hevel majority shareholder Ream Management LLC
November 30, 2021
South Korean LG Electronics has announced a series of new appointments as it aims to target greater growth and customer satisfaction moving into 2022, while also elevating certain critical departments to division level in order to supply them with greater resources
November 30, 2021
Solar risk manager kWh Analytics has launched a new offering that it says allows PV project owners to receive upfront payments in return for maintaining asset performance.
November 30, 2021
‘Solar Module Super League’ (SMSL) member Canadian Solar has raised US$150 million through a share offering, with proceeds set to help the manufacturer expand its energy storage arm.
November 29, 2021
Commercial and industrial (C&I) solar developer Altus Power will offer distributed renewables and energy storage solutions through a new partnership with energy major Shell.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
December 1, 2021
Solar Media Events
February 1, 2022
London, UK
Solar Media Events
February 23, 2022
London, UK
Solar Media Events
March 23, 2022
Austin, Texas, USA
Solar Media Events
March 29, 2022
Lisbon, Portugal

Cyber Monday Flash Sale – 50% off our subscriptions

24 hours only