“Hydropower King”, “China’s Richest Man” and “Energy King”… These are the labels that the outside world has attached to Li Hejun, the founder of Hanergy and chairman of the board of directors of Hanergy Mobile Energy Holdings Group. Behind these labels is the story that Li Hejun has experienced and told in his many years of business career.

But now, the story of Li Hejun’s “Let all things generate electricity” is facing a crisis. After the Hanergy Group was exposed to arrears in employee salaries, Tianyan data showed that since 2020, the Hanergy Group has been listed as an enforcer by the court 70 times. At the same time, a number of subsidiaries including Beijing Hanergy Photovoltaic Technology Co., Ltd. were listed as executed persons.

How will the Hanergy Group story continue? Li Hejun once said, “Only knowing the past of Hanergy can we know the future of Hanergy.” So now, let us first look at the three stories that Li Hejun once told the market.

01 Inspirational Story: Jinanqiao Hydropower Station

“When we did it, everyone thought it was a joke and it was impossible to do it. But we squatted in the ravine for ten years, and the soil was dried up one by one.” Since the completion of the Jinanqiao Hydropower Station, Li Hejun has been publicized as a typical story of Hanergy Group growing up in doubt.

Before the construction of the Jin’anqiao Hydropower Station, Li Hejun was already a successful businessman. In 1988, Li Hejun graduated from the Department of Mechanical Engineering of Northern Jiaotong University. After graduation, Li Hejun started his business with 50,000 yuan borrowed from his teacher. He began to buy electronic components from Zhongguancun. He has been involved in toys. Trade, mining, hydropower and other businesses.

In 2002, Li Hejun’s group already owned many small hydropower stations in Guangdong, Qinghai, Zhejiang, and Guangxi. This year, Li Hejun and other private entrepreneurs went to Yunnan to invest in a group organized by a department of the central government. The hydropower resource project in Yunnan Province made Li Hejun shine, and the Jinanqiao Hydropower Station in Hanergy was officially opened in 2003.

According to Li Hejun’s statement, the total investment before and after the construction of the Jin’anqiao Hydropower Station was 20 billion yuan, and the daily investment during the peak period reached 10 million yuan. In order to maintain the operation of the project, Li Hejun successively sold hydropower stations in Zhejiang, Qinghai, and Guangxi, almost investing the company’s family. Go in.

At the end of 2008, the Jinanqiao Hydropower Project, which had already invested heavily, was disclosed as being unapproved and was suspended by many banks. In order to solve the capital problem, Li Hejun once ceded the status of majority shareholder of Hanergy Group and introduced the chairman of Hengji Weiye Zhang Zhengyu. Zhang Zhengyu withdrew after the Jinanqiao Hydropower Station was officially connected to the grid in April 2011. Later, Li Hejun recalled that during the preparation process, he said, “At that time, the funds were like a grinding disc, which made me unable to breathe.”

In 2011, Jinanqiao Hydropower Station started to store water to generate electricity. After the completion of Jinanqiao Hydropower Station, the total installed capacity of the two phases will reach 3 million. In August 2012, when all four units were connected to the grid for power generation, the annual power generation exceeded 13 billion kWh. The completion of the Jin’anqiao Hydropower Station not only brought Hanergy an annual income of several billion yuan, but also brought greater prestige and capital to Li Hejun. With these capitals, Li Hejun began to talk about his next story, photovoltaic energy generation.

In the second half of 2019, the Hanergy Company was successively exposed to negative news such as employees collectively seeking salary, being sued for financial loan contract disputes, and the Jinanqiao Hydropower Station shares being auctioned. The financial difficulties encountered by Li Hejun in the preparation of the Jinanqiao Hydropower Station are now staged again in the story of photovoltaic thin films.

On June 12, 2019, Li Hejun once again mentioned the construction experience of Jin’anqiao Hydropower Station in his speech at the Han A privatization reply A meeting. He said, why should I speak? Because you know the past of Hanergy, you can know the future of Hanergy. Most people in this world do not believe in Hanergy, but if you believe this, you may have a chance, so if you win trust, you will win everything.

02 Capital Stories: From the richest man to wage arrears

“We tend to overestimate the change of one to two years and underestimate the change of five to ten years. The change of one to two years sometimes disappoints us, and the change of five to ten years always surprises us.” China’s photovoltaic industry is facing a serious crisis, but Li Hejun still often put this sentence in his mouth.

Intriguingly, reality went in the opposite direction as Li Hejun estimated. Two years later, in 2014, the stock price of Hanergy Thin Film Power Generation, which was listed on the Hong Kong stock market, rose continuously. Li Hejun successfully reached the top of China’s richest man. However, in 2019, seven years later, Hanergy Film had to choose to be privatized from Hong Kong stocks, and the company was exposed Negative news such as arrears in employee salaries and tight funding.

Li Hejun entered the photovoltaic thin film market in 2009, when Li Hejun told the market that it was a story of dominating the photovoltaic market with solar thin film technology and ultimately achieving clean energy production.

In 2013, Hanergy Film Group successfully backdoor listing on Hong Kong stocks. The business of the listed company Hanergy Film is mainly divided into upstream and downstream. The upstream is to provide production equipment to the industrial park producing thin-film photovoltaic modules, and the downstream is to sell related thin-film products.

It is worth noting that since 2012, China’s photovoltaic industry has begun to appear in crisis, but from 2011 to 2014, the net profit of Hanergy Film has achieved a rapid growth from 730 million Hong Kong dollars to 3.31 billion Hong Kong dollars. Supported by dazzling performance, at the end of 2014, the share price of Hanergy Films started to take off, from HK $ 1.8 / share to a peak of HK $ 9.07 / share on March 5, 2015. .

The turning point occurred on May 20, 2015. The share price of Hanergy Thin Films plunged quickly shortly after the opening day, from 7.35 Hong Kong dollars to 3.91 Hong Kong dollars, after which the company announced a suspension. On May 28, the Hong Kong Stock Exchange announced that it would investigate Hanergy Films. On July 15, the Hong Kong Securities Regulatory Commission made rare punitive measures that ordered Hanergy Film to cease all share transactions.

So far, the Hong Kong Stock Exchange has not announced the results of the investigation of Hanergy. However, in the media reports that year, related transactions and market manipulation were considered by the market as the main reason why Hanergy Film was investigated by the Hong Kong Stock Exchange. In fact, since the listing, the related transaction of Hanergy Film has been criticized by the outside world. In 2013, the related transaction of Hanergy Film reached 100%. In 2014, the related party transactions decreased slightly, still up to 62%, and the top five customers accounted for 98% of sales.

Under the huge amount of related party transactions, the business model of Hanergy’s thin film power generation is highly questioned by the market. Some market participants pointed out that for a long time, the parent company Hanergy Group was the only customer of Hanergy Films. Hanergy Films sold its own production equipment and a complete set of production lines to associates or related companies. The thin film components, and finally the Hanergy films bought these components back and installed them in the relevant power stations. This left-handed-to-right business model makes it difficult to believe the authenticity of the company’s performance.

After being investigated by the Hong Kong Stock Exchange, in order to resume trading in Hong Kong stocks, Hanergy Films has taken a number of measures, including the termination of multiple connected transactions with the parent company, Li Hejun stepped down as chairman, and Hanergy Films’ controlling shareholder from Hanergy Group, etc. , But none of them are recognized by the Hong Kong Stock Exchange. In 2019, Hanergy Films, which had no hope of resuming trading and may be forced to be delisted, finally chose privatization.

According to the plan of privatization, Hanergy Film’s stocks held by independent shareholders will be replaced by shares of SPV in a one-for-one manner, and Hanergy Mobile’s controlling shareholder, Hanergy Mobile, will seek to list on A shares in the future. Successfully, independent shareholders will hopefully replace their SPV shares with A-shares.

Nowadays, the A-share market has become more stringent in its supervision of related-party transactions of listed companies. Hanergy Group’s plan to return to A is at a loss. The capital story depicted by Li Hejun is experiencing bottlenecks.

03 Business Story: Let everything generate electricity

“Let all things generate electricity” is an ambitious wish that Li Hejun created for the Hanergy thin-film solar market and the ultimate picture described in Li Hejun’s business story.

In 2009 when Hanergy entered the photovoltaic market, there were two technical routes of thin film and crystalline silicon in the photovoltaic industry. Compared with thin film technology, the conversion rate of crystalline silicon technology to light energy was higher, which was the mainstream technology in the market at that time.

But Li Hejun finally chose thin film technology. Compared with crystalline silicon technology, the application range of thin film technology is more extensive. In addition to being used in power plants, thin film technology may also be used in new energy vehicles, roofs, glass and other distributed scenarios. “Let all things generate electricity”.

But to be applied to these scenes, the thin film technology not only needs to solve the problem of low light energy conversion rate, but also to find the real scene where the thin film technology is applied.

For this reason, after 2013, Hanergy Group successively acquired four leading overseas companies to master copper indium gallium selenium and gallium arsenide thin film technology that can achieve higher conversion rates. On the other hand, Hanergy Film also developed The products that apply thin film technology, such as Han Wall, Han Watt, and Han Umbrella, expand the practical application scenarios of thin film technology.

However, from the data of the 2018 annual report, despite the heavy investment in technology research and development and product application, the actual sales of Hanergy’s film products downstream is still not directly proportional to the sales data of upstream equipment. The annual report shows that in 2018, Hanergy’s revenue from upstream business (both research and development, design and sales of thin-film solar high-end equipment production lines) was HK $ 19.55 billion. There are 1.7 billion Hong Kong dollars.

At this point, Li Hejun’s three story lines have begun to end. Whether the inspirational story can be staged again depends on whether Li Hejun can successfully get out of the current dilemma; Has the ability to self-produce blood; as to whether self-produced blood can be achieved, it depends on whether the thin film technology of the Hanergy Group can really “make all things generate electricity”.

But nowadays, under the situation that the downstream business is still difficult to achieve self-blood production, the Hanergy Group, whose funds have begun to show signs of tension, can really hold up to that day?