Photovoltaic circle reappears with industry peers taking over: Hongyuan Green Energy enters Wuxi Suntech restructuring

Interface News Reporter | Ma Yueran

The photovoltaic sector sees another case of industry peers stepping in for restructuring, with Hongyuan Green Energy (603185.SH) officially announcing its entry into the bankruptcy restructuring of Wuxi Suntech.

On March 25, Hongyuan Green Energy announced that its holding subsidiary, Hongyuan Photovoltaics (Wuxi) Co., Ltd. (hereinafter referred to as Hongyuan Photovoltaics), signed a restructuring investment agreement with Wuxi Suntech and its administrator. After the agreement is signed, the restructuring investor can form an investment consortium as the lead investor.

Hongyuan Photovoltaics and Wuxi Suntech will jointly establish New Suntech, with a registered capital of 1 billion yuan. It is specified that the equity contributed by Wuxi Suntech will be used to implement debt-to-equity swaps for ordinary creditors.

In terms of specific investment amounts, Hongyuan Photovoltaics will contribute 630 million yuan, and New Suntech will pay 142 million yuan as restructuring investment.

In the future, Hongyuan Photovoltaics will hold about 63% of the equity in New Suntech and will form an investment consortium as the lead investor, bringing in other investors, who will hold about 27% of New Suntech’s equity, while the creditor equity platform will hold 10% of New Suntech’s equity.

This means that Jiangsu Shunfeng Photovoltaic Technology Co., Ltd. (hereinafter referred to as Shunfeng Photovoltaic) will completely exit Wuxi Suntech.

After the establishment of New Suntech, the 142 million yuan restructuring investment paid to Wuxi Suntech will be used to acquire assets necessary for New Suntech’s operation, including equity in certain subsidiaries and the Suntech brand, among other assets. The aforementioned restructuring investment will be used to cover bankruptcy costs, common benefit debts, employee claims, corresponding taxes, debt repayment, and related expenses paid to improve the repayment rate for ordinary creditors.

The restructuring investment plan also mentions that if the actual monetary funds available for Wuxi Suntech to contribute to New Suntech are less than 100 million yuan, Hongyuan Photovoltaics commits to supplement the shortfall as part of the aforementioned agreement’s restructuring investment.

Image source: Announcement from Hongyuan Green Energy

Currently, Wuxi Suntech has entered the formal restructuring process. The announcement indicates that while the restructuring plan (draft) has been approved by the creditors’ meeting, there remains uncertainty as to whether the draft will receive court approval after the vote.

Hongyuan Green Energy stated that upon completing the restructuring, it will provide comprehensive support to Wuxi Suntech from multiple dimensions, including strategy, resources, brand, channels, funding, management, and talent. Leveraging the existing brand equity of Suntech, Hongyuan Green Energy can quickly enhance its international influence.

Additionally, Hongyuan Green Energy believes that its business closely matches and synergizes with Wuxi Suntech, and if the restructuring is successful, the company will achieve deep vertical integration of the industrial chain with New Suntech, further enhancing the stability and overall efficiency of the supply chain, as well as improving profitability and risk resistance.

Wuxi Suntech was established in 2001 and is a well-established photovoltaic enterprise, primarily engaged in the research and production of solar cells and modules, founded by Shi Zhengrong, who is known as the “Godfather of Chinese Photovoltaics.”

This is Wuxi Suntech’s second bankruptcy restructuring.

In March 2013, the Wuxi Intermediate People’s Court ruled for the restructuring of Wuxi Suntech based on applications from eight creditor banks. Ultimately, Jiangsu Shunfeng Photovoltaic became a strategic investor in Wuxi Suntech, spending 3 billion yuan to take over.

As the domestic photovoltaic industry has entered another adjustment period since 2023, companies in the supply chain are suffering significant losses, leading Wuxi Suntech to once again “run out of steam.”

The latest announcement discloses that as of May 26, 2025 (the date the court accepted Wuxi Suntech’s pre-restructuring), Wuxi Suntech’s audited total assets were 537 million yuan, total liabilities were 4.578 billion yuan, and net assets were -4.041 billion yuan, indicating clear insolvency.

In December 2024, Wuxi Suntech was placed under the management of Xiamen Jianfa Group, a long-established state-owned enterprise in Xiamen, and Wuxi Suntech’s chairman, Wu Fei, stated that he no longer serves as the company’s chairman.

In June last year, the National Enterprise Bankruptcy Restructuring Case Information Network released a notice of pre-restructuring debt claims for Wuxi Suntech.

A month later, Hongyuan Green Energy announced a collaboration with Wuxi Suntech and other companies to conduct production and operational management to help Shunfeng Photovoltaic maintain stable operations at Wuxi Suntech. This also means that Hongyuan Green Energy has replaced Xiamen Jianfa as the new manager of Wuxi Suntech.

Hongyuan Green Energy was established in 2002, headquartered in Wuxi, Jiangsu Province, originally known as Shangji CNC, founded by Wuxi native Yang Jianliang. It started as a photovoltaic silicon wafer equipment supplier and later expanded into the entire photovoltaic industry chain.

The headquarters and registered address of Hongyuan Green Energy are the same as Wuxi Suntech, both located in Wuxi, Jiangsu Province. Therefore, there are rumors in the industry that this transaction was facilitated by the local government.

Last year, Hongyuan Green Energy was one of the few profitable companies in the main photovoltaic industry chain, reporting a net profit of 180 million to 250 million yuan, turning a profit, although the company reported a net loss of 250 million to 310 million yuan after excluding non-recurring gains and losses during the same period.

As of the end of September last year, Hongyuan Green Energy had a debt ratio of 54.87%, total liabilities of 14.715 billion yuan, and total assets of 26.819 billion yuan.

After announcing the restructuring of Wuxi Suntech, Hongyuan Green Energy’s stock price fell by 3.08% on March 26, closing at 23.58 yuan per share, with a total market value of approximately 16.1 billion yuan.

As of 11 a.m. on March 27, Hongyuan Green Energy’s stock price was reported at 24.14 yuan, an increase of 2.25%.