90 Million Yuan! GCL New Energy to Sell Subsidiaries With 7 Solar Power Plants

PVTIME – On March 16, GCL New Energy Holdings Ltd. (0451.HK) announced that its indirect subsidiaries Suzhou GCL New Energy and Suzhou GCL Development entered into Share Purchase Agreements with Jiangsu Hesheng, a company mainly engaged in power generation, transmission, power supply business as well as engineering and construction activities.

According to the announcement, Suzhou GCL companies agreed to sell the entire equity interest in Gaoyou GCL, Nantong Haide New Energy, Pizahou GCL, Suqian Green Energy Power and Suzhou Industrial Park Dingyu and 60% equity interest in Jiangsu GCL Haibin New Energy to Jiangsu Hesheng.

The aggregate consideration under the Share Purchase Agreements is 90,379,800 yuan. And the target companies collectively own 7 operational solar power plants in China with an aggregate grid-connected capacity of approximately 85MW.

Upon completion of the transactions, the target companies will no longer be subsidiaries of GCL, and the profit and loss as well as the assets and liabilities of the target companies will no longer be consolidated into the consolidated financial statements of GCL. Meanwhile, the cash derived from the transactions is expected to be approximately 311,364,123 yuan, which the company intends to use for repayment of its debts, and the gearing ratio will decreased by about 0.6%, calculated with reference to the unaudited financial statements of GCL as at June 30, 2021, then effectively reducing the financial risks.