Property Tycoon Revealing $20 Billion Solar-Led Portfolio

Sep 30, 2014 | ,

Property Tycoon Revealing $20 Billion Solar-Led Portfolio

The Hong Kong property tycoon who gathered almost $20 billion in Chinese solar manufacturing assets is expanding his reach in other green energy technologies and may seek Wall Street money to do it.

Zheng Jianming, chairman and founder of Asia Pacific Resources Development Investment Ltd., is considering a public listing for the holding company he created to manage what may be the biggest collection of solar-manufacturing businesses.

The Hong Kong-based company is also investing in battery technology, electric cars, geothermal systems and even units that use seawater to store electricity. The goal is to supply clean energy for almost every aspect of daily life, “from the power source to heating and cooling, lighting and vehicles,” Zheng said.

“If a city were to implement all of these technologies it would basically be low-carbon,” he said in an interview in New York. “My vision for this company isn’t just for China. I want to create a global company.”

Zheng, 50, estimates he’s invested $2.5 billion to $3 billion in clean power over the past decade. That includes almost $1 billion to become the largest shareholder in Shunfeng Photovoltaic International Ltd. (1165), a panel maker and power-plant developer based in Changzhou, China, with shares listed in Hong Kong.

This is the first time Zheng has spoken publicly since he began quietly expanding his efforts to acquire assets and stakes in Chinese solar companies in 2012. He’s avoided public appearances and has declined to answer questions delivered in writing until now. Yesterday, he broke his silence, meeting with potential investors at a conference in New York.

‘SUITABLE TIME’

“For many years I watched the industry’s development and waited for the most suitable time to invest,” said Zheng, who is also known in Cantonese as Cheng Kin Ming.

Shunfeng has become the flagship for his renewable-energy aspirations. It acquired in April the main manufacturing unit of Suntech Power Holdings Co. (STPFQ), which was once the world’s biggest solar panel maker. The corporate parent failed to pay $541 million in U.S. bonds last year. Its Wuxi, China, production operations were pulled into bankruptcy in China.

Shunfeng agreed in May to purchase the insolvent German solar inverter producer Sunways AG (SWW) for 2.2 million euros ($2.8 million) and is buying the assets of S.A.G. Solarstrom AG, a solar developer that’s also insolvent, for 65 million euros.

Another Zheng holding company acquired in 2013 as much as 25 percent of LDK Solar Co. (LDKSY), the second-biggest photovoltaic wafer producer. It has since defaulted on 1.7 billion yuan ($276 million) of notes that matured in February.

SOLAR SLUMP

He was buying into solar as the industry was mired in a slump triggered by a global oversupply of panels. Shunfeng shares were at 30 Hong Kong cents in November 2012, when Zheng took over. They have increased to HK$7.24 yesterday, and the company now has a market value of HK$17.3 billion ($2.2 billion).

Zheng expects Suntech to triple shipments of solar panels this year to 2.4 gigawatts, from about 800 megawatts last year. Including his other clean energy assets, he expects to develop power plants with a capacity to generate 50 gigawatts of power. That’s enough when the sun is shining to supply all of South Africa, where the state-owned utility has about 42 gigawatts of installed capacity.

“Shunfeng will be a pure clean energy provider,” Zheng said in the interview at the Next Generation Solar PV Finance Conference.

ENERGY STORAGE

Shunfeng has also made investments in the energy-storage company Powin Energy Corp. and Boston Power Inc., which is developing batteries for electric vehicles.

It’s backing Taiwan Carbon Nanotube Technology Corp., which is using nanotechnology in battery systems based on seawater, and Green Wheel Electric Vehicles, a Chinese supplier of electric cars and buses.

Asia Pacific Resources’ various holdings may be difficult to stitch together into a coherent clean-energy powerhouse, said Shyam Mehta, an analyst at Boston-based GTM Research, said in an interview.

“It could be that there is some strategy behind this, of actually rebuilding these companies and getting them to work together in a way that enhances both their value and builds up some sort of mega solar company,” Mehta said. “Maybe it’s nothing that exceptional. He just has a lot of holdings in several different solar companies.”

PUBLIC OFFERINGS

Zheng said he may pursue initial public offerings for some of the individual businesses, such as Boston Power or Lattice Power Corp., a Chinese producer of energy-efficient lighting. Eventually, he would consider a public listing for the parent company Asia Pacific Resources, he said, without providing additional details.

He got his start investing in real estate in China, and later expanded into technology. Zheng said his ventures have mirrored China’s development, and clean energy is what the country needs now.

“In my many years of investment, I’ve been focused on the development of the industry’s value chain,” said Zheng. “That is why I’ve never made a mistake.”

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