Union Power set to scoop up failed Sun Electric’s solar assets

SINGAPORE’S electricity retailer Union Power has submitted a “binding offer” to scoop up the solar assets of failed Sun Electric group for S$2.2 million, sources told The Business Times (BT).

The offer by Union Power – an electricity retailer in the city-state – was submitted last month to the judicial managers (JMs) of Sun Electric Energy Assets (SEEA), a subsidiary under the group that was licensed to generate and export electricity to the national grid until the solar firm ran into financial troubles more than two years ago.

According to sources, the JMs are working to complete the sale of the assets, which could also include solar panels on JTC rooftops.

SEEA is a subsidiary of holding company Sun Electric Pte Ltd (SEPL), which installed 5.5 megawatt-peak of solar photovoltaic panels on JTC properties under a contract with JTC Corp, Singapore’s industrial landlord.

The sale will need to get the nod from secured creditors who hold “respective charges” over part of the solar assets. Secured creditors may stand to get around S$1.6 million from the sale proceeds after deducting, among others, the fees for the JMs, JMs’ legal counsel, disbursements and liquidation expenses, BT understands.

When contacted, Union Power declined to comment on the matter.

Union Power stepped up its solar energy game more than a year ago amid volatile electricity prices and a global energy crunch that saw many of its peers in Singapore’s electricity retail market close shop. The firm is part of the Union Energy Group, which is a majority owner of Singapore-listed Union Gas .

The potential sale of the solar assets is happening three years after SEPL’s wholly-owned Sun Electric Power went under liquidation after commodity house RCMA Asia won the bid in court to wind up the firm in September 2020.

Sun Electric Power, Singapore’s first solar company, was once deemed a rising star in the burgeoning solar space as the city-state cranked up efforts on clean energy.

RCMA had pushed to wind up Sun Electric Power, an electricity retailer for mid-size and large businesses, after it failed to pay RCMA some S$7.5 million as it was cash flow and balance sheet insolvent. The outstanding payments largely entailed “incentive payments” due to RCMA for assuming the solar firm’s market-making role in the electricity futures market.

The fallout from Sun Electric Power’s collapse has come fast and furious since then. The company’s founder Matthew Peloso was hit with mounting claims to the tune of some S$15 million from partners-turned-creditors, including a lengthy patent fight.

In February this year, the Singapore High Court ordered Peloso, a Canadian residing in Singapore, to pay Kumar Vikram some S$366,025.

This resulted from a claim filed by Vikram against Peloso in late November last year to recoup a “friendly loan” he had provided Peloso in June 2015.