China Solar Energy sells its Hong Kong subsidiary for $2.7m

30 July 2010

China Solar Energy has agreed to sell 85 per cent of the share capital of its money-lending subsidiary D&M Finance for HK21m ($2.7m) to an individual Hong Kong investor.

The company said it will use the proceeds from the sale as working capital.

On the completion of the sale, the company will no longer be a subsidiary of China Solar Energy but will have 15 per cent of its share’s retained.

The company said that the amount, which was negotiated on commercial terms, will be paid fully in cash, with regard to the unaudited consolidated net asset value of around HK$24.38m ($3.13m).

The company’s directors have agreed to the fairness of the terms of the agreement but the sale is conditional on consents by third parties relating to the seller in connection with the transactions.

The sale is expected to be completed three days after the conditions of the sale have been completed, said China Solar.

The principal activity of D&M is investment holding and it is principally engaged in money-lending activities in Hong Kong, but its subsidiaries consist of photovoltaic business and strategic investments.

The audited net loss before tax of D&M for the fiscal years ending in 2009 and 2010 were approximately HK$14,000 ($1,801) and HK$8.89m ($1.14m) respectively.

The audited net profit after tax for D&M for the year ending in 2009 was approximately HK$1.12m ($144,201) and its audited net loss after tax for the year ending in 2010 was HK$8.94m ($1.15m).

The company said it has decided to make the sale because it is optimistic about the prospect of its core PV business, particularly as the Chinese government has enacted several policies to support the emerging industry, including a regional feed-in tariff and national subsidies for PV installations.

The group said it will continue to seek partners to develop its building-integrated PV business.

Based on its retained investment in D&M, China Solar estimates that the expected net gain from the sale will amount to less than HK$279,000 ($35,921).

Copyright © 2010 NewNet

Tags: solar

This story was published on Friday, July 30th, 2010 at 12:04 pm and is filed under Asia, deals, solar. You can follow any responses to article entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

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