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Swancor Made a Surprise Midnight Announcement of Selling Its Offshore Wind Subsidiary

published: 2019-06-25 15:37

Swancor Holding Co. Ltd. announced in the early morning of June 21 (1:38 a.m.) that it will be selling its offshore wind power subsidiary Swancor Renewable Energy Co. as well as its shares in the Formosa II wind farm. Swancor Holding gave notice to media outlets on June 20 at 11:35 p.m. that it was going to issue a major public statement. The announcement to sell its subsidiary was made just over an hour later.

The board of Swancor Holding actually finalized the decision to sell Swancor Renewable Energy and the stake in Formosa II at a meeting held on June 20. The value of the entire transaction is currently estimated to be worth between US$25.98 million and US$101.47 million, according to the filing made by the company concerning the proposed deal.

This event has been met with great concern across Taiwan’s renewable energy market. Until very recently, Swancor Holding has been a leading supporter of the massive offshore wind initiative that is being pushed by Taiwan’s government. A few days before this announcement, Robert Tsai, chairman of Swancor Holding, wrote a Facebook post discussing the enormous difficulties that his company faces in trying to stay in the offshore wind market. In his Facebook post, Tsai says that his team has worked very hard to develop a viable offshore wind business despite the unfavorable market outlook. He points out that Taiwan still does not possess the necessary conditions to form a local supply chain for building offshore wind farms. Specifically, the development of this industry is being hampered by the lack of offshore resource, supporting regulations, native industry talents, port facilities, marine engineering vessels, and capital

Tsai also notes that his company spent around NT$40 billion and toiled ceaselessly to set up the two demonstration turbines for the first phase of the Formosa I wind farm. The construction of the two turbines, which are located off the coast of Miaoli County, was finally completed in October 2016.

The timing of the announcement has raised a lot of eyebrows. Usually, a listed company in Taiwan will not wait this late in the day to release an important statement. Although night-time announcements do occur, broadcasting the sale of a subsidiary along with the large-scale disposal of shares right after midnight in local time is an extremely rare event.

Since Europe dominates the global offshore wind market, the prospective buyers of Swancor Renewable Energy and the shares of Formosa II will likely come from that region. However, Swancor Holding did not disclose the identities of the interested parties at its press conference due to confidentiality issues.

(This article is an English translation of news content provided by EnergyTrend’s media partner TechNews. Source of the top photo: Swancor Holding Co. Ltd.)

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