SunEdison acquisition of Vivint suspected of illegal operations

Polaris solar PV net news: according to the findings of the Audit Committee and independent Director, United States renewable energy company SunEdison lingering financial woes can be directly attributed to “management too optimistic.”

Survey also found that SunEdison has fired a non-management employee in VivintSolar suspected irregularities in the takeover plan, the plan after months of struggle ended in failure.

Explicitly stated in the survey report, the independent directors, SunEdison’s management had not resorted to any property such as fraud, misconduct and other illegal acts. However, the company management team assessment to actual cash flow is “overly optimistic”, leading to the property dilemma.

Report cites four negative behavior, the first is “cash of the company assessed the lack of effective controls and procedures. “Second, the Board has long been fooled by cash budget management team excessive optimism and lack of communication between the two mechanisms, especially in major projects could not reach an agreement. Third, when expectations are not completed, the management failed to timely reporting. Finally, focus or contradiction of SunEdison’s cash flow could not be effectively controlled and processed.

In order to remedy these disadvantages, the report listed a number of remedial measures, the Board believes that these measures can hold up this sinking ship. Measures include: effective cash flow monitoring systems, and strengthen supervision and control, management and Board of Directors more transparent dialogue between involved decisions at the project level, in anticipation and forecast more sober attitude.

SunEdison has recently enabled a new Chief Financial Officer, and has proposed the recall of several important management decisions, which are independent directors as a positive phenomenon.

Drubbing?

However, industry experts and analysts generally believe that these remedies come too late, too small, no turning back. Who asked not to be named, industry insiders say, view SunEdison has still not been released in 2015 the fourth quarter and full year earnings and debt-ridden, this report helps the bucket.

MercomCapital RajPrabhu, Chief Executive, said in the report there are comforting signs, referring in particular to the Board believes there is no “significant false” or “deliberate violation of management”, is in doubt. Prabhu said, nevertheless, the report is also recognized in many areas of management failure.

Prahbu said: “I think this report can boost the morale of SunEdison in the short term. However, to face reality after all, cash control loose, optimism seems to be the originator of corporate culture. ”

Most in the industry believe that SunEdison developed to this point will be on the road to bankruptcy. Company has debts of more than $ 11.7 billion, and faces at least $ 1.4 billion in loans and bonds, currently under United States Department of Justice and the United States Securities and Exchange Commission investigation.

Early this year, when VivintSolar takeover will end when the Hawaiian Electric Company announced the withdrawal of 148MW hydropower station power purchase agreement signed with SunEdison. In this regard, the Hawaii public utilities Commission (HPUC) this week explains, “had not carefully considered the SunEdison bankruptcy possibility. ”

In addition, SunEdison publicly expressed its intention to give up India’s large PV projects, a subsidiary of TerraFormGlobal sued the parent company of misappropriation of the $ 231 million to cover maturing loans, fuelling the SunEdison.

Original title: SunEdison acquisition of Vivint suspected of illegal operations

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