Money Matters | Solar power firm's spree on bond sales casts shadow
Despite doubts about United PV’s prospects, big-name subscribers and soaring share price add mystery over spate of convertible issues
Heads turn when big names enter the game. That was what happened at United Photovoltaics Group, which has seen its share price shoot up by 70 per cent in less than two months.
Nine major mainland and international financial houses have agreed to buy more than HK$4.5 billion of convertible bonds from the solar power producer.
Among them are Ping An Insurance (Group), Citic Capital, China Huarong Asset Management and Fosun International.
The details are, however, puzzling.
First, United PV's financial safety is in doubt. Its current liabilities amount to HK$1.8 billion. And the figure excludes some contractual obligations that have to be settled in the near future.
Auditor Price Waterhouse said this indicated "the existence of a material uncertainty which may cast doubt on the company's ability to continue as a going concern".