Chinese polysilicon maker GCL-Poly Energy Holdings Ltd (HKG:3800) and its troubled solar plants operating unit GCL New Energy Holdings Ltd (HKG:0451), or GNE, are preparing to sell interests in 790 MW of solar assets to a unit of China Three Gorges Group Co Ltd.

Certain subsidiaries of GCL-Poly and GNE have agreed to sell to Three Gorges Asset Management Co Ltd their stakes, some full and some partial, in companies that own a total of 11 operational solar power plants in China. This will be done in two transactions -- one covering six solar parks totalling 321 MW and another involving five facilities totalling 469 MW.

The sellers said that this move is part of GCL-Poly’s strategy to adopt an asset-light model. By disposing of the solar plants in the first transaction, the group will reduce its liabilities by about CNY 1.294 billion (USD 198.4m/EUR 167.7m) and secure some CNY 927.6 million in cash for further debt repayments. The second transaction will cut the group’s liabilities by a further CNY 4.253 billion and bring in an additional CNY 1.385 billion in cash for that same purpose.

The asset disposals are pending clearance by GCL-Poly and GNE’s shareholders.

As previously reported, GNE defaulted on USD 500 million (EUR 423m) worth of 7.1% senior notes on January 30, 2021. Less than two weeks later, holders of 91.85% of the defaulted senior notes approved a debt restructuring plan that set January 30, 2024 as the new maturity date.