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Sinovel Wind to Shut Four Overseas Subsidiaries

Sinovel Wind Group Co. has confirmed that it is closing four international subsidiaries, marking the latest setback for the company, which is one of China's largest wind-turbine manufacturers. In a filing to the Shanghai Stock Exchange on Monday, Sinovel said it would shut its units in the U.S., Belgium, Italy and Canada. It is unclear how large these units are.

The Chinese Turbine Maker Says the Shutdowns Aren't Related to Legal Problems in the U.S.

BEIJING-Sinovel Wind Group Co. has confirmed that it is closing four international subsidiaries, marking the latest setback for the company, which is one of China's largest wind-turbine manufacturers.

In a filing to the Shanghai Stock Exchange on Monday, Sinovel said it would shut its units in the U.S., Belgium, Italy and Canada. It is unclear how large these units are, and the company's website didn't provide details.

Sinovel began in late April to shut subsidiaries deemed to be "not in accordance with development strategy" or lacking "development potential," spokeswoman Wang Wen said in a statement Tuesday.

Ms. Wang said the closures have nothing to do with the company's continuing legal problems in the U.S.

Late last month, the U.S. Justice Department filed criminal charges against Sinovel and two of its senior executives in the latest chapter of a corporate-espionage dispute that has simmered for years. The indictment against Sinovel included charges of trade-secret theft, criminal copyright infringement and wire fraud.

The U.S. alleges that Sinovel stole source codes for software used to control wind turbines from AMSC, a Massachusetts-based engineering firm, and then shipped four turbines equipped with the allegedly pirated code to customers in the U.S. A lawyer representing Sinovel has declined to comment on the case.

Until 2011, when it abruptly stopped taking deliveries of AMSC gear, Sinovel was the U.S. firm's largest customer.

The U.S. charges could potentially aggravate bilateral ties.

U.S. Secretary of State John Kerry, while in his capacity as the senior senator from Massachusetts last year, called the AMSC-Sinovel dispute "a mugging in broad daylight and a real test of China's commitment to the rule of law."

AMSC is pursuing four separate civil actions in Chinese courts related to the allegedly stolen software.

A slowing global economy has tempered China's ambitions to dominate the global wind- and solar-power industries.

A cyclical downturn has hammered demand for solar panels, for example, pushing China's Suntech Power Holdings Co. into bankruptcy proceedings. Suntech, the largest supplier of solar panels in 2011, has blamed part of its financial losses, facility closures and layoffs on antidumping and antisubsidy tariffs that the U.S. imposed last year on solar cells produced by Chinese companies.

Meanwhile, the country is mired in a trade dispute with the European Union over solar-power equipment exports. The EU is seeking higher tariffs against the exports, and China retaliated with an antidumping probe into wine imports from the EU last month.

The U.S. followed its 2012 solar-power-related tariffs up by slapping antidumping tariffs on Chinese wind-tower suppliers.

Sinovel has fared poorly amid the slowing domestic market and overcapacity in the sector. In April, it announced a 58% on-year plunge in revenue last year, swinging to a net loss of 582 million yuan ($92 million) compared with a net profit of 598 million yuan a year earlier.

In May, the company came under investigation by the China Securities Regulatory Commission over suspected violations of securities laws and regulations, state-run Xinhua news agency said. The commission's Beijing bureau said in April that some of Sinovel's financial data was inaccurate, including inflated profit disclosures the company reported for 2011, Xinhua said. The company has said it would work with the commission, the industry's state-backed watchdog, in the probe.


 


Source: http://online.wsj.com/artic...

JUL 2 2013
http://www.windaction.org/posts/37597-sinovel-wind-to-shut-four-overseas-subsidiaries
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