Swancor Holding Co Ltd (上緯投控) on Friday announced that its board of directors has resolved to sell its renewable energy and offshore wind farm subsidiary, suggesting that the company is to exit the offshore wind farm business.
The firm’s shares on Friday closed down by the daily maximum of 10 percent at NT$93.6 in Taipei trading.
The proposed sale of all 20 million Swancor Renewable Energy Co (上緯新能源) shares at US$1.30 to US$5.07 per share to unspecified European or US energy companies would bring the total transaction to between US$25.98 million and US$101.47 million, Swancor Holding said in a filing with the Taiwan Stock Exchange.
As of March 31, Swancor Renewable’s net value was NT$67.72 per share. Excluding earnings distribution for last year, its net value was NT$16.82 per share, the parent company said in the filing.
Swancor Holding is expected to receive a disposal gain of US$9.14 million to US$84.63 million, the filing said.
The company did not identify the buyer or buyers by name, citing confidentiality.
Swancor Holding has invested in two offshore wind farms in the waters off Miaoli County’s Jhunan Township (竹南), with the 128-megawatt project operated by Formosa I Wind Power Co (海洋風力發電) scheduled to be operational by the end of this year and become Taiwan’s first offshore wind farm project to generate power.
Another 376-megawatt project by Formosa II Wind Power Co (海能風力發電) is expected to be completed by the end of next year.
However, its bid to invest in a 2-gigawatt project off the coast of Changhua County in April last year failed to gain approval from the Ministry of Economic Affairs.
The company said in the filing that it had fulfilled its initial obligation to facilitate the development of the nation’s green energy industry and therefore decided to sell Swancor Renewable.
However, Swancor Holding chairman Robert Tsai (蔡朝陽) in a post on his personal Facebook page on Tuesday last week indicated his intention to withdraw from the wind farm business.
Swancor Renewable would have no wind farms to develop from 2021 to 2025 after Formosa III Wind Power Co (海鼎風力發電) failed to gain development rights, an unfavorable business outlook that has quickly made the subsidiary unattractive to foreign investors, Tsai said.
“This newly formed unicorn just cannot find what it needs for future growth in its own country,” Tsai wrote. “The [April] bidding results seriously damaged the team at Swancor Renewable, and left the most painful and permanent mark in my heart.”
Considering Swancor Renewable employees’ development and shareholder interests, Swancor Holding said that it has decided to sell the subsidiary to foreign investors, hoping the buyers could continue to lead the unit and expand investment in the nation’s offshore wind farm projects.
Swancor Holding, whose core business includes resins and composite materials manufacturing, reported that consolidated revenue rose 13.08 percent annually to NT$2.63 billion (US$84.43 million) in the first five months of this year.
In the first quarter, net income stood at NT$66.33 million, compared with a net loss of NT$42.08 million a year earlier, company data showed, representing earnings per share of NT$0.72.
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