The inside story of Suntech in Shi Zhengrong

Layoffs, production cuts, GSF counter-guarantee scam, Suntech Power's share price falling to $1, facing delisting pressure and resigning as CEO ... In 212, Shi Zhengrong, the former photovoltaic giant, was besieged on all sides; In 213, I'm afraid it will also be the most critical "critical autumn" for Suntech. The debt ratio of more than 8% and the $575 million convertible bonds due in March are the difficulties that Suntech must face directly.

Previously, there was a lot of discussion about the game between Wuxi municipal government and Shi Zhengrong. Among them, the most talked about statement is that Wuxi municipal government will offer assistance to Suntech at the price of Shi Zhengrong's unlimited liability guarantee with all his personal assets, but this plan failed to win the support of Shi Zhengrong.

People close to Wuxi Suntech said that Shi Zhengrong and Wuxi municipal government seem to have reached a balance in the dark war. Since Shi Zhengrong stepped down as CEO of Suntech Power in August 212, Wuxi Guolian Group may take over Wuxi Suntech as a financial investor to solve the urgent need for Suntech Power's $575 million convertible bonds to expire. Wuxi Suntech is a subsidiary of Suntech Power, a listed company, and it is also its core asset and main operating entity.

"Now Guolian Group has formed a working service team to enter Suntech's office, and creditors of major banks have also entered Suntech to find a better plan to save Suntech." The above-mentioned insiders said.

Although the project has not been settled, it will be a reincarnation for Suntech if the final offer is really made by Guolian Group. As early as January 21, when Wuxi Suntech was founded, Wuxi Guolian Trust and Investment Company, a subsidiary of Wuxi Guolian Group, joined hands with Jiangsu Little Swan Group, Wuxi High-tech Investment Company, Wuxi Mercury Group, Wuxi Venture Capital Company, Wuxi Shanhe Group and many other state-owned enterprises to invest US$ 6 million in Wuxi Suntech, holding 75% of Wuxi Suntech. Shi Zhengrong, on the other hand, invested 4, US dollars in cash and 1.6 million US dollars in technology, holding a 25% stake in Wuxi Suntech. In 25, in order to facilitate overseas listing, Shi Zhengrong introduced bridge loan and overseas investment institutions (such as Goldman Sachs, Longke Investment, French Natexis, etc.) through a series of financial technologies to acquire the state-owned shares of Wuxi Suntech, and Wuxi Guolian Group also withdrew together with other state-owned shares at this time.

In this reincarnation, Shi Zhengrong, who made a fortune from sunshine, stepped down from the altar from the honor of "godfather of new energy" and "richest man in China". But at the same time, Shi Zhengrong, which is out of the public eye and in a hidden place, has actually built its own private business kingdom. In this private kingdom, Shi Zhengrong's wife, friends, and fellow villagers each keep a corner. Only by crossing them can we catch a glimpse of Shi Zhengrong's invisible wealth. "Shi Zhengrong can completely recreate a Suntech." The above-mentioned insiders said, "But from another direction, if there were no private enterprises like Shi Zhengrong, Suntech's current situation might not be so bleak." In the six years after Suntech went public, Shi put billions of dollars of property into the hands of his private company.

on December 3th, 26, an enterprise named "Asia Silicon Industry (Qinghai) Co., Ltd." (hereinafter referred to as "Asia Silicon Industry") was incorporated in Qinghai province. According to the documents obtained by the Qinghai Provincial Department of Commerce, this company was established by Asia Silicon Industry Co., Ltd., British Virgin Islands, hereinafter referred to as "Asian Silicon Industry (BVI)" and Qinghai New Energy Research Institute Co., Ltd. * *, in which Asia Silicon Industry (BVI) invested 47.5 million US dollars, holding 95% of the shares, and Qinghai New Energy Research Institute Co., Ltd. invested 2.5 million US dollars, holding 5% of the shares.

this is an enterprise engaged in research, development, production and sales of polysilicon materials. It seems that this enterprise has nothing to do with Shi Zhengrong himself, but it turns out that this enterprise was completely controlled by Shi from the very beginning.

According to informed sources, Wang Tihu, the first chairman of Asia Silicon Industry, met Shi Zhengrong while studying in Australia. Suntech's internal address book shows that in 26 and 27, Wang Tihu also served as the vice president of Suntech, mainly responsible for the development and research of silicon materials and high-efficiency solar cells.

other board members include Zhang yuxin, sha juntao, Guo enlai and Zhang Zhimin. Among them, Zhang Yuxin and his successor, Zhang Weiguo, were very close to Shi Zhengrong himself.

Zhang Yuxin is the legal representative of Asia Silicon Industry (BVI). He once worked in Huaxia Securities Investment Banking Department and Southwest Securities Investment Banking Department, and later established Shanghai Daojie Investment Co., Ltd. as the executive director and general manager, and Shanghai Daojie Equity Investment Management Co., Ltd. as the executive director. In personal relations, Zhang Yuxin is a relative of Shi Zhengrong's wife Yuna Cheung. Before Suntech's IPO, he was Shi Zhengrong's main financial adviser and led the capital operation of Shi Zhengrong's takeover of shares from Wuxi's state-owned shares before Suntech's IPO.

only three months after its establishment, on March 15th, 27, the members of the board of directors of Asia Silicon Industry changed. Sha Juntao and Guo Enlai left the board, Zhang Weiguo and Liao Hui became members of the board of directors of Asia Silicon Industry, and Zhang Weiguo became the chairman and legal representative of the board of directors of Asia Silicon Industry. At this time, the board members of Asia Silicon Industry included: Chairman Zhang Weiguo and directors Zhang Yuxin, Wang Tihu, Liao Hui and Zhang Zhimin.

Zhang Weiguo is also an important member of the Shi family. He was once the manager of the investment department of Wuxi Venture Capital Company. Suntech Power's IPO prospectus shows that Zhang Weiguo was the fifth largest shareholder of Suntech at that time, holding 333, shares.

Shi Zhengrong really came to the front of the Asian silicon industry as a manager because of Suntech's investment in the Asian silicon industry in 29.

according to suntech's annual report, in January 29, suntech bought 12.5% shares from an "exiting shareholder" in the Asian silicon industry for $8.1 million. In October of the same year, Suntech Power increased its shareholding ratio to 2%-Suntech Power paid a total of $17.5 million for this 2% equity. From the relatively simple ownership structure of Asian silicon industry, it can be seen that this "withdrawing shareholder" obviously comes from Asian silicon industry (BVI), and later it is proved that the ultimate controller of Asian silicon industry (BVI) is actually Shi Zhengrong.

The reporter obtained a registration document from BVI Registry in 26, which showed that the first directors of BVI were actually Shi Zhengrong and his wife Yuna Cheung. That is to say, Shi has been involved in the Asian silicon industry since its establishment, but he has been hiding behind Zhang Yuxin until 29, and has never disclosed to Suntech's shareholders, banks providing loans and other participants in the capital market.

It was not until Suntech started to invest in the Asian silicon industry in 29 that Shi Zhengrong was able to retreat from the behind-the-scenes status of being the helm of the Asian silicon industry (BVI) and walk to the stage as the chairman of Suntech's board of directors.

due to suntech's investment, the board members of the Asian silicon industry changed further on January 8, 29. Through this change of board members, we can get a glimpse of the layout of Shi Zhengrong.

According to the public information of Qinghai Provincial Administration for Industry and Commerce, on January 8, 29, Zhang Yuxin and Liao Hui withdrew from the board of directors of Asian Silicon Industry. The new board members include Shi Zhengrong, Chen Qiuming, Wang Tihu, Zhang Weiguo and Zhang Zhimin. After this personnel change, Shi Zhengrong became the chairman of the board of directors and legal representative of the Asian silicon industry.

on may 18th, 29, Asian Silicon Industry passed the resolution of the board of directors, and Asian Silicon Industry (BVI) bought 5% equity held by Qinghai New Energy Research Institute Co., Ltd., thus, Asian Silicon Industry was jointly held by Asian Silicon Industry (BVI) and Suntech. Zhang Zhimin, a representative of Qinghai New Energy Research Institute Co., Ltd., therefore withdrew from the board of directors.

Another personal friend of Shi Zhengrong officially came out after this transaction-Chen Qiuming, a new director, once worked for Jiangsu International Trust and Investment Company, moved to Australia after 1991 and met Shi Zhengrong in Australia. In 28, Chen Qiuming was invited by Shi Zhengrong to return to China, and his main responsibility was to take care of Shi Zhengrong's private wealth. Many people in the industry regard Chen Qiuming as the new financial adviser and investment strategist after Zhang Yuxin.

"Is it possible that Shi Zhengrong can become the chairman of the board of directors and the legal representative of the Asian silicon industry only by virtue of Suntech's 12.5% equity? These are all Shi Zhengrong's bureaus. " A former Suntech employee said. After this series of operations, the board of directors of the Asian silicon industry is completely composed of Shi Zhengrong's "own people". Since its establishment, the Asian silicon industry has maintained close cooperation with Suntech.

in January, 27, less than a month after its establishment, the Asian silicon industry won a big order from Suntech: Suntech signed an unconditional payment contract with it for 16 years to purchase high-purity polysilicon materials; According to the official website of the Asian silicon industry, it was not until December 31, 28 that the first batch of polysilicon in the Asian silicon industry was officially released.

during this period, although the Asian silicon industry did not supply Suntech, Suntech still transfused the upstream supplier. According to Suntech's annual report, in 28, Suntech Power provided an interest-free loan of US$ 1 million to the silicon industry in Asia. As for prepayments, Suntech Power provided $61.2 million in prepayments to the Asian silicon industry from 27 to 28, but the Asian silicon industry had not really realized polysilicon production at this time, and the supply to Suntech did not begin until the first half of 29. More interestingly, after the Asian silicon industry began to supply in 29, the Asian silicon industry quickly became one of the three major suppliers of Suntech Power.

According to the above-mentioned insiders, in addition to business cooperation, Suntech Power has also helped the Asian silicon industry from manpower: "Suntech's financial personnel have been helping the Asian silicon industry roadshow and obtaining loans from banks." With Suntech's large orders, the Asian silicon industry has successively obtained loans from banks (including at least a loan of 5 million yuan from Standard Chartered Bank guaranteed by Suntech Power) and subsidies from the local government in Qinghai as supplementary funds.

after suntech started to invest in the silicon industry in Asia in 29, the blood transfusion to the silicon industry in Asia did not stop after suntech's investment. In terms of product purchase, Suntech still spared no effort. In 21, it purchased 76.9 million US dollars of polysilicon from the Asian silicon industry and provided 82.4 million US dollars of advance payment for the Asian silicon industry.

"Shi Zhengrong is too good at creating wealth for himself. The outside world usually pays little attention to it, so it is almost unaware of the operation of Shi Zhengrong behind it, but if you look at these transactions together, you will find something embarrassing. " The above-mentioned former Suntech employees said.

What he said was the odd transaction, that is, Suntech's withdrawal from the investment in Asian silicon industry and Shi Zhengrong's entry-in October 29, Suntech increased its investment in Asian silicon industry, and its shareholding ratio increased to 2%; In December 21, "due to the strategic adjustment", Suntech Power sold the 2% equity for $23.9 million, and Suntech made a net profit of $6.4 million from this investment.

The buyer who took over the 2% stake was "Jiangnan Capital founded by Zhong Xiaolin," said the person close to Suntech Power. This news has never been disclosed by Suntech Power, and the reporter failed to get confirmation from Suntech Power. As a PE, Jiangnan Capital's real investment subject behind it is not easy to predict.

However, the story of equity transfer continues, and the transferred investors gradually emerge.

In May p>211, Shi Zhengrong announced that the family trust controlled by him-D&; M technology (d&; M Technologies) acquired a 91.3% stake in the Asian silicon industry, and the Asian silicon industry officially became a related party of Suntech. Strangely, during the five months from Suntech's withdrawal from the Asian silicon industry in December 21 to Shi Zhengrong's family trust taking over the Asian silicon industry in May 211, Shi Zhengrong remained the chairman of the board of directors and legal representative of the Asian silicon industry, and there was no change.

By the end of p>211, Suntech was in a photovoltaic crisis-at that time, Suntech's debt ratio was 79%, and its short-term borrowing was $1.573 billion. However, as an upstream supplier of Suntech, the Asian silicon industry is immune to it, with an asset-liability ratio of only 36.7% and short-term borrowing from yuan.

in the reality that the photovoltaic industry as a whole is in a quagmire, the performance of the silicon industry in Asia cannot be separated from Suntech's support: in the five years since its establishment, Suntech has provided it with at least $1.5 billion in unconditional payment contracts, $1 million in interest-free loans, 5 million yuan in guarantees and nearly $1 million in advance payments, and has been its only customer for a long time. In July 211, Suntech also signed a new polysilicon purchase contract with the Asian silicon industry, that is, 63,3 tons of polysilicon will be purchased from the Asian silicon industry within 9 years from 212. In addition to the silicon industry in Asia, Shi Zhengrong has also established another private company-Brilliant Silicon Technology Investment (HK) Company "BVI Company".

According to the information obtained from BVI Registry, Brilliant Silicon Technology was also registered in the British Virgin Islands in 26, and the controllers are Shi Zhengrong and Yuna Cheung. This information is also little known. "Shi's earliest idea was that the Asian silicon industry produced polysilicon and sold it to brilliant silicon energy. Brilliant mainly produces silicon wafers and sells them to Suntech. " The above-mentioned insiders told Global Enterprise? Home.

It's just that brilliant silicon energy is not as successful as the Asian silicon industry in the end. In brilliant silicon energy, Shi Zhengrong suffered from interpersonal relationship waterloo, and brilliant silicon energy also came to the end of separation.

Similar to the silicon industry in Asia, Brilliant Silicon Technology (BVI) established Brilliant Silicon Energy (Zhenjiang) Co., Ltd. (hereinafter referred to as Brilliant Silicon Energy) in Youfang Town, Yangzhong City, Jiangsu Province, Shi's hometown in 27. The 28 audit materials of Brilliant Silicon Energy obtained by the reporter show that Brilliant Silicon Energy is a wholly foreign-owned enterprise funded by Hong Kong Deyi Co., Ltd., which was established in December 27. Hong Kong Deyi Co., Ltd. is a wholly-owned subsidiary of Brilliant Silicon Technology (BVI).

but before that, it was widely said that brilliant silicon energy was established in 27 with joint capital contributions from Hong Kong Brilliant Silicon Technology Co., Ltd., Wuxi Suntech and Huantai Silicon Technology. In this regard, the reporter found no evidence when consulting the public information of Suntech Power.

at the beginning of the establishment of brilliant silicon energy, the board of directors was composed of Wu meirong (also the chairman of the board), Wang Yicheng and Li Zhongying. Wu Meirong and Li Zhongying are both fellow villagers in Shi Zhengrong and directors of two Hong Kong subsidiaries (Hong Kong Deyi Co., Ltd. and Hong Kong Rising Prosperity Co., Ltd.) of Brilliant Silicon Technology (BVI) respectively.

in may p>28, suntech power invested in brilliant silicon technology (BVI) and took over "an withdrawing shareholder" to acquire 18% equity of brilliant silicon energy at a cost of $21.4 million. After attracting capital injection, brilliant silicon energy is exactly the same as the Asian silicon industry, and the board of directors has also been changed-Wu Meirong continues to be the chairman, and the board members include Shi Zhengrong, Qian Xiaoyun, Yoko (then CFO of Suntech) and Chen Qiuming.

Suntech Power also started trading with Brilliant Silicon Technology (BVI) in its early days. In 27, Suntech provided $1.8 million to Brilliant Silicon Technology (BVI).