Sun Cable Pty Ltd has said that it has entered voluntary administration.
Calling it a difficult decision, Sun Cable said that the voluntary administration process will now unlock a path forward for it to access additional capital for continued development of its project, the Australia-Asia PowerLink (AAPowerLink) and progress the next stage of its development portfolio in a strong market.
Voluntary administration is a process designed to give a company ‘breathing space’ from its normal operations. When a company is experiencing financial difficulty and cannot pay its debts, the company directors can appoint someone called an administrator. The administrator will then attempt to save the company by organizing its assets and liabilities.
Christopher Hill, David McGrath and John Park of FTI Consulting have been appointed as voluntary administrators of Sun Cable. The administrators have not been appointed to any of the Company’s subsidiaries. The Administrators intend to work with Sun Cable’s management team and key stakeholders to determine appropriate next steps for the business. This will likely involve a process to seek expressions of interest for either a recapitalization or sale of the business.
The appointment followed the absence of alignment with the objectives of all shareholders. Whilst funding proposals were provided, consensus on the future direction and funding structure of the company could not be achieved.
Sun Cable continues to represent an outstanding strategic opportunity to operationally deliver the largest renewable energy project in the world, with the AAPowerLink project to supply power to the Northern Territory and Singapore, commencing late this decade. Sun Cable currently has a portfolio of a further 11 GW of proposed projects, which is equivalent to over 3 times that of the AAPowerLink. Chair of Sun Cable, Mike Cannon-Brookes said:
“Sun Cable has achieved so much since it was founded in 2018. I’m confident it will play a huge role in delivering green energy for the world, right here from Australia. I fully back this ambition and the team, and look forward to supporting the company’s next chapter.”
In October 2022, Sun Cable was 50% over-subscribed for offtake interest in Singapore, having received Letters of Intent (LoI) for 2.5GW, versus planned supply of 1.75GW. In November 2022, its project in the Northern Territory saw interest of around 30GW of renewable electricity demand, resulting in scope for further projects to be developed to serve this demand.
Founder and CEO of Sun Cable, David Griffin said:
“Sun Cable has made extraordinary progress in developing the AAPowerLink. This project remains well placed for completion. As we have progressed our work, the demand for delivering reliable, dispatchable 24/7 renewable energy in the NT and the region has risen materially. Sun Cable looks forward to developing and operating the projects to meet this demand.”