Failed Australian solar and battery project developer Lyon Solar has been ordered to pay roughly $A6 million plus interest to global PV giant First Solar, after the Federal Court found in favour of the US company.
The judgment, handed down late last week, punctuates a years-long stoush between the two companies, which centred around a loan from First Solar, which had been tapped as preferred PV module supplier in the early stages of several Lyon projects.
In a decision handed down late last week, the Federal Court ruled that the loan agreement with First Solar was valid and that the loan was due and repayable in the sum of $6,016,686.70, with interest.
The Court also found in favour of the plaintiff on the “take-or-pay agreement” claim, finding that the plaintiff was entitled to damages in the amount of $US3.25 million plus interest.
The dispute over the loan had first escalated in late 2017, when the Australian Securities and Investment Commission posted an insolvency notice advising that First Solar had applied to wind up Lyon Infrastructure Investments Pty Ltd.
In November of 2017, First Solar succeeded in obtaining an injunction against Lyon from selling certain assets pending a resolution of the dispute, and also won a federal Court order for ASIC to reinstate the company, which had been de-registered.
At that point in time, Lyon was still claiming to have the largest pipeline of solar and storage projects in Australia – 1700MW of solar and 1000MW of battery storage across South Australia, Victoria, NSW, and Queensland – and to be in the last stage of selling its three most advanced projects.
Two years later, in October 2019, Lyon Infrastructure Investments 1, Lyon Solar and Lyon Battery Storage were placed in the hands of liquidators, Deloitte.
In January of 2020, a report to ASIC by Deloitte painted a bleak picture for the Lyon’s various creditors – which included Japan energy giant Jera and US investment firm Magnetar – who were believed to be owed around $30 million, collectively.
The Deloitte report flagged that the creditors might get no return from the liquidated assets, depending on the sale price of Lyon’s undeveloped projects, and questioned the actions of Lyon directors, including for possibly trading while insolvent.
Source: Lyon Solar
Date: Feb 22, 2021
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