SunSi Energies Inc. develops Trichlorosilane (TSC), a component essential to the production of polysilicon for solar panels. As part of its stated acquisition objective, SunSi subsidiary SunSi Energies Hong Kong Inc. has agreed to acquire 90 percent of Zibo Baokai Commerce and Trade Co., the exclusive owner of distribution rights in China for the TCS produced by Zibo Baoyun Chemical plant (ZBC).
The deal is scheduled to close no later than June 30, 2010. When the transaction is complete, SunSi will hold 100% of the distribution rights for ZBC’s TCS productions, both in China and abroad. SunSi said upon finalizing the acquisition, it expects to generate between $1.5 million and $2.0 million in monthly revenue.
However, despite positive expectations, SunSi’s recent efforts to complete the deal were met with opposition. Michel G. Laporte, chairman and CEO of SunSi, said certain aspects of the agreement have not been met, and that the company is hopeful, though not confidant, of closing the deal.
“During the last nine months we have taken all of the necessary steps to consummate the acquisition of the ZBC factory. These steps include preparing GAAP audited historical financial statements for ZBC, and conducting extensive due diligence. Despite our best efforts, we have been unable to close on the transaction because certain deal conditions requested by SunSi, remain unsatisfied. Although there can be no assurance that we can complete the transaction, we are still hopeful that we will able to resolve the open issues enabling us to close,” Laporte stated in the press release.
Laporte also said SunSi has worked to fulfill its financial goals, and noted company’s recent acquisition of rights to distribute TCS outside China and its continued work to gain rights to distribute in China.
“In the interim we have taken the necessary steps to help position ourselves to achieve our objective of generating revenues and profits for the benefit of shareholders. In December 2009, we acquired the rights to distribute TCS outside of China. I am pleased to report today that we have now addressed the distribution of TCS within China through the signing of a definitive agreement with Baokai and can look forward to begin generating revenue by July 2010,” Laporte stated.