Sunergy Shanghai, established in November 2007 for solar cell production, solar power research and other activities, could not develop substantive operations due to market conditions. Its divestment will not impact China Sunergy’s overall production capacity.
In the second quarter of 2014, China Sunergy is expected to receive about RMB79.6m ($13m) in cash proceeds, while the remaining will be settled through forgiveness of the amount due from China Sunergy by Sunergy Shanghai.
As per the agreed terms, CEEG will not use Sunergy Shanghai or its assets to engage in any business, which is competitive to the company.
The deal remains subject to customary closing conditions.
China Sunergy CEO Stephen Cai said the sale of Sunergy Shanghai follows an extensive and thoughtful evaluation of potential options relating to sale of Sunergy Shanghai.
"We believe these resulting improvements will contribute meaningful long-term rewards to the Company," added Cai.
