SPI Solar has officially entered into a non-binding memorandum of understanding (MOU) to subscribe to shares in Guocang Group Limited. This strategic investment is being made along with Evergrande Real Estate Group Limited.
Guocang is engaged in various business segments, and its board believes that the additional funding represented by this MOU would enable it to, among other things, pursue investment in the high-growth area of solar power in China. Following the close of the transaction, Evergrande will work with Guocang to develop solar projects in China with SPI’s technical support and services.
Under the terms of the non-binding MOU, SPI Solar and Evergrande will subscribe to 7,464,114,830 shares and 30,813,397,130 shares, respectively, of Guocang at a subscription price of HK $0.03135 per share. In addition, SPI Solar, via a separate announcement, announced that it had entered into a purchase agreement with a subsidiary of Evergrande as the lead investor, along with another investor, for the sale of U.S. $43.8 million of shares of SPI’s common stock in private placements.
The completion of the subscription as contemplated by the MOU is subject to certain conditions, including entry into a definitive subscription agreement and satisfaction of the conditions therein.