Sunpower Group receives escrow of consideration for divestment of business

SUNPOWER Group has received an escrow of consideration for the divestment of its manufacturing and services (M&S) business, Sunpower Technology (Jiangsu), according to a bourse filing on Friday.

The group noted that an advanced payment equal to 10 per cent of the consideration has been escrowed into the onshore escrow account. A further amount of 1.98 billion yuan (S$406.1 million), which amounts to 86.5 per cent of the consideration, has also been escrowed into the onshore escrow account on April 28.

The remaining 3.5 per cent of the consideration will be escrowed into the onshore escrow account prior to the completion date of the second tranche, Sunpower said.

The group has also amended its letter of undertaking. Previously, the letter of undertaking agreed that Sunpower Group will withhold an amount of 100 million yuan, which is equivalent to the balance consideration amount from the tranche 1 special dividend payable to shareholders till the total consideration is received.

Given that the amount of consideration that has yet to be escrowed is 80 million yuan, the withheld amount will be reduced correspondingly.

On Dec 31 last year, Sunpower Group announced that it was divesting its M&S business for 2.3 billion yuan, after which 1.3 billion yuan of the net proceeds will be used for a proposed special dividend amounting to 1.1627 yuan per share on a fully diluted basis.

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The purchaser of the M&S business is a special purpose vehicle (SPV) called Nanjing Sunpower Holdings Co, incorporated in China. The SPV is equally owned by Sunpower Group's executive chairman Guo Hong Xin and Ma Ming, the group's executive director.

Sunpower noted in its bourse filing that all conditions of the first tranche, which include registering the purchaser as the 100 per cent shareholder of Sunpower Technology, have been satisfied.

In relation to the divestment, the group's vice-president Jiang Yanyun, chief investment officer Chen Kai and chief financial officer Ge Cui Ping have resigned from their positions, and will be joining the purchaser from April 30. Wang Hui has been appointed the new chief financial officer of Sunpower Group, effective April 30.

As at 10.49am on Friday, Sunpower shares were trading 1.1 per cent or S$0.01 lower at S$0.92.