Sky Solar intends to enter the Chinese solar market with a belief that the country is a high-priority growth opportunity due to its large size and rapidly growing renewable energy sector, as well as the Company's own extensive knowledge of the market.
The company plans to own fully operational solar assets, as well as build and transfer assets to external third parties which are mainly state-owned conglomerates and public companies. The Company has always planned to target selective provinces with large imbalances between power supply and demand, as well as the most attractive financial strength, based on the ability to make timely payments of feed-in-tariffs.
Then entering plan and certain acquisitions has been approved by Sky Solar’s board of directors. Among the targets under evaluation include solar park and EPC assets owned by private entities controlled by the Company's Chairman, Mr. Weili Su, which own 165 MW of projects in operation and under construction and 4.9 GW of projects in various stages of development. Pursuant to the company's Corporate Governance Guidelines, a majority of the company's directors, including all of the company's independent directors, must approve any acquisition of businesses, solar parks or other assets from related parties or independent third parties. All approvals are based on a myriad of factors including but not limited to IRR, technical specifications of the solar project (including sun irradiation hours, components and performance guarantees) and technical, financial and legal due diligence.
The Company is also establishing a new business platform, to be named "Sky-Link", for integrating supply-chain and industry data and analysis, and standardizing solar project quality control and monitoring. The Company will use these capabilities internally as well as offer the services to third parties for a fee. The Company is evaluating a potential acquisition of Changzhou Sky Solar New Energy Technology Co., Ltd. at fair market value by Sky-Link, in order to quickly enter the solar project quality control and monitoring business.
To quickly establish Sky Solar's China operations, the Board has approved the transfer of a number of experienced senior leaders from the private entities controlled by Chairman Su to Sky Solar Holdings, Ltd. The Company expects the addition of these experts to provide the market and operating knowledge necessary for the Company to succeed in this initiative. Notable management changes include the appointment of the Company's current Chief Investment Officer, Mr. Zhi Hao, as the new Managing Director of Sky Solar China. Mr. Yu Hu, a new addition to the Company, will be appointed as Executive Vice President of the Company and President of Sky-Link.
The Company is currently pursuing a number of financing alternatives to implement the proposed transactions associated with this strategic initiative.