Utility scale systems Nove ECO and MG Solar with capacity of 5 MW and 4.7 MW, respectively, located in Bulgaria, were purchased by Solar World Invest Fund SIF (SWIF), based in Luxembourg, from ReneSola Ltd. The two projects located in Sliven were deemed as long-term assets on the balance sheet since end of 2013, according to the statement by the company based in China. The sale will be booked as disposal of assets, with no direct impact on revenue, the press release adds. The transaction consideration is a combination of cash and assumption of project debt. Such structure of the transaction consideration reflects the company’s focus to reduce its debt, ReneSola said.
SWIF, private equity fund, has investments in medium-sized solar installations around the world. It enables investment in rooftop and ground-mounted photovoltaic plants, the press release said. The fund’s strategy is to generate returns through investments in solar energy and the sale of electricity.
The two sold power plants generated attractive cash flows since they were completed in 2012, said Li Xianshou, ReneSola’s chief executive officer. “However, our current project development strategy is to build and transfer select projects in order to enhance our cash flow and pay down debt. This sale is another milestone in our strategic transformation into a leading downstream developer. We look forward to additional monetizations this year as many projects are completed from our 641 MW pipeline,” he added.
Founded in 2005 and listed on the New York Stock Exchange in 2008, ReneSola provides energy efficient products. Prior to the sale of the two projects, the company said it repurchased all of its remaining convertible notes, worth USD 5.6 million and due March 15, 2018, upon exercise by note holders of the put option which expired on March 14 this year. ReneSola’s move comes after it reported a drop in revenue of 18% for last year, attributing it to the strategic shift to project development which significantly reduced net loss and operating expenses, while increasing gross margin to 14.7% from 13.4%. Total revenue was USD 1.28 billion and the annual net income fell 10.2% to USD 187.9 million. Projects with the total capacity of 72.8 MW were sold after they were developed by ReneSola.
Total solar module shipments fell 18.9% from 2014 to 1.6 GW while total wafer shipments were up 28.7% at 1.09 GW, the company said.