European largest PV company starts bankruptcy application

Headquartered in Hamburg, Germany, Kangneng was once Europe's largest solar energy group. The bankruptcy filing this time was mainly due to its 10% of existing creditors' plans to absorb new strategic investors. Before Kangneng, Germany's major solar companies, such as Q-cells, Bosch Solar, Sovello, Odersun, etc., have successively declared bankruptcy or exited the PV business.

On July 5th, a news from the website of the Ministry of Commerce of China stated that the Conergy Group (hereinafter referred to as “Kangeng”), a photovoltaic company that was the largest solar group in Europe, had submitted an application for commencement of bankruptcy proceedings to the local court.

Prior to this, Germany's major solar companies, such as Q-cells, Bosch Solar, Sovello, Odersun, etc., have successively declared bankruptcy or exited the PV business. According to the German "World News" report, Kangneng was once a flag of the German solar industry and one of the few remaining PV companies in Germany.

At a time when the Sino-European PV negotiations are sensitive, the bankruptcy of Kangneng will inevitably have an impact on the negotiations between the two sides. It is worth noting that on July 4, Japan was the day when the Chinese Ministry of Commerce released the results of the preliminary ruling on polysilicon in Europe and the United States, but it has not yet been released.

The market value is only about 1/44 in 6 years.

“Unexpected payment delays in a large PV project have caused liquidity problems in its German components and installation systems”

Headquartered in Hamburg, Germany, Kangneng was once the largest solar group in Europe. At the peak of the solar industry in 2007, the market value of Kangneng exceeded 2.2 billion euros, and today it is only 57 million euros. The data shows that in 2012, the company's revenue was 474 million euros (611 million US dollars), and the operating loss was 83 million euros. It is reported that the subsidiaries of the company will also file for bankruptcy.

It is worth pondering that last year, the company’s new chairman, Kong Beige, publicly stated: “Overseas markets, especially in Asia and North America, have performed well. I hope that this year and next year, salted fish will turn over and return to profitability.” Nowadays, salted fish Did not turn over.

It is reported that the bankruptcy filing this time is mainly due to the fact that 10% of existing creditors oppose the plan to absorb new strategic investors. Kang Neng said that the unexpected delay in payment for a large PV project triggered liquidity problems in its German components and installation systems, forcing the company to seek creditor protection.

Kongberg said, "In the past 15 months, we have shown the creditors the two specific investment plans of the investors. Unfortunately, they did not reach a reliable agreement on the timely realization of the proposal. Without a solid capital structure, Kangneng It is difficult for the group to continue its development plan."

Like many PV module manufacturers, Kangneng has shifted its focus to downstream markets that are more dependent on PV projects, but this requires more capital injection.

Kangneng is currently hoping that an investor in Asia will pay off its bank debt and inject new capital. The company said in a statement that the company's leadership has always been optimistic about the prospects. They believe that under the bankruptcy process, the company will re-open its business through the funding of new investors.

German PV companies have fallen

“The global shale gas exploration boom, many countries have reduced their investment in new energy and shifted their focus to shale gas related projects”

In fact, before Kangneng, Germany's major solar companies, such as Q-cells, Bosch Solar, Sovello, Odersun, etc., have successively declared bankruptcy or exited the PV business.

In April of this year, the market value reached 8 billion euros in 2007, and it is estimated that only 35 million euros of German solar cell factory Q-Cells filed a bankruptcy claim. In March of this year, Bosch announced that it was unable to produce and lay off employees. It is expected to end the business of solar photovoltaic industry in 2014, when all development and marketing activities will be terminated. According to preliminary estimates, Bosch has a total loss of 2.4 billion euros. The company attributed it to global overcapacity and unsustainable component price declines.

Analysts believe that the competition from Asian manufacturers and the decision of the German government to cancel subsidies for the solar photovoltaic industry policy are the reasons for the collapse of these PV companies.

In this regard, Han Xiaoping, chief information officer of China Energy Network, disapproved. He believes that the root cause of the European PV companies is the shale gas revolution initiated by the United States. After the successful development of the US shale gas 'quietly', the global shale gas exploration boom has been lifted, which has reduced many countries to new Investment in energy and other aspects, capital will also shift from new energy to shale gas related projects, the reduction of capital has intensified the bankruptcy of enterprises, this phenomenon is also played in the Chinese market."

Sino-European PV negotiations have large spreads

The Brussels delegation proposed the lowest price: 0.65 euros per watt ($0.85/watt), and the Beijing negotiator said: “0.50 euros/watt is more acceptable”

It is worth noting that the current period of sensitivity is the sensitive period of China-EU PV negotiations, and the two sides are conducting price negotiations. If an agreement cannot be reached by August 5, the anti-dumping duty of Chinese companies will increase to 67.9%. According to the reporter, the price gap between the two sides is currently large. It is reported that the lowest price proposed by the delegation of Brussels is: 0.65 euros per watt (0.85 US dollars / watt), the quotation is currently rejected by the Chinese. Beijing negotiators said that some German companies have sold at less than 0.58 euros/watt in the EU market. The Beijing negotiator said: “0.50 Euro/W is more acceptable.”

It is worth noting that, according to the “Investigation Procedure Reference Schedule” in the service hall next to the Communication Office of the East Gate of the Ministry of Commerce, July 4 is the deadline for the Ministry of Commerce to issue the “EU Solar-grade Polysilicon Anti-Dumping Preliminary Decision”. But it was not released the same day. The double-reverse investigation of the EU polysilicon has been regarded as a counter-measure of China against the EU.

The delay in the release of the results has led to speculation in the industry. They speculated that the negotiations on the Sino-European PV price commitments were still inconclusive, the two sides are still playing, and the boots are more proactive.

So, will Kangneng declare bankruptcy at this time to affect the negotiations? After all, the EU's anti-monopoly investigation of China's PV is due to the collapse of European PV companies due to the dumping of Chinese PV companies.