Clarification regarding insolvency of Industrial Solar GmbH
Clean Industry Solutions Holding Europe AB (publ) ("CISH Holding" or the "Company") hereby publishes a clarification regarding the insolvency of one of its wholly owned subsidiaries, Industrial Solar GmbH. The board of CISH Holding believes that there is additional information that the stock market needs to be made aware of, hence this clarification.
CISH Holding completed a rights issue in September 2023, resulting in CISH Holding receiving approximately SEK 10 million after the deduction of issue costs. At that point in time, CISH Holding did not have any information about a potential insolvency process nor did CISH Holding know that this would happen.
Historically, CISH Holding has lent capital to the subsidiary Industrial Solar GmbH and then the debt has been offset against share capital. But when CISH Holding's liquidity forecast last week indicated that Industrial Solar GmbH has too much negative equity, the management sought legal counsel. Due to the current negative equity in Industrial Solar GmbH, the German legal counsel advised that Industrial Solar GmbH should file for insolvency to avoid larger damage to the group.
At this point, it is important to understand that German insolvency law is more focused on balance sheet over-indebtedness and the prognosis for the continuation of the company, while Swedish insolvency law is more focused on insolvency, regardless of the balance sheet situation.
Even with further loans from CISH Holding presenting a possibility of continuing business, Industrial Solar GmbH could not be freed from the threat of being over-indebted again in the following months. Recognizing that additional loans from CISH Holding would only delay, not avert, insolvency, Industrial Solar GmbH has to file for insolvency to avoid larger damage to the group. The decision for CISH Holding's board was arduous, with a commitment to safeguarding the shareholders' assets in CISH Holding.
Through this measure, the board has preserved SEK 7 million in CISH Holding (the amount of cash CISH Holding holds as of today's date). This enables CISH Holding and its other wholly owned subsidiary SolarSpring GmbH to continue operations until the end of 2024. SolarSpring GmbH will continue business as usual and focus on membrane distillation for ultra-pure water production, primarily targeting green hydrogen production. CISH Holding sees high demand for this type of technology. This technology holds immense market potential by leveraging waste heat from electrolyzers to generate the ultra-pure water necessary for hydrogen production.
Contact information:
Clean Industry Solutions Holding Europe AB
c/o Win-Win Ekonomi AB
Palmfeltsvägen 21
SE-121 62 Johanneshov/Sweden
E-Mail: info@cleanindustrysolutions.com
Amudova AB is Clean Industry Solutions’ certified adviser. Phone +46 8 546 017 58
E-mail: info@amudova.se
Clean Industry Solutions Holding Europe AB holds 100% of Industrial Solar GmbH and 100% of SolarSpring GmbH - both located in Freiburg/Germany.
Industrial Solar GmbH is an international leading technology and solution provider, which develops projects mainly based on its innovative Fresnel collector technology suitable for fulfilling an expected growing market of solar process heat. As a one-stop-shop Industrial Solar offers turnkey solutions for customers in several industries.
Find out more about Industrial Solar GmbH at the following address:
https://www.industrial-solar.de/en/
Founded in 2009 as a spin-off of the Fraunhofer ISE, SolarSpring GmbH - membrane solutions, has evolved into an international pioneer in the field of membrane distillation offering innovative waste- and drinking water treatment technology.
Find out more about SolarSpring GmbH at the following address:
https://solarspring.de/en/