Tier one PV manufacturer, China Sunergy (CSUN), is selling a non-active facility to major shareholding affiliate company, China Electric Equipment Group (CEEG).

CSUN said that China Sunergy (Shanghai) Co., Ltd., a subsidiary of the company that had initially been established in 2007 with a minority interest from CEEG to produce high-efficiency solar cells and undertake solar power research and development activities, but that had subsequently been idled in 2012, would be sold to CEEG for a cash return of US$13.0 million.

However, the deal is worth a total of US$37.7 million to CSUN as the remaining consideration of US$24.7 million is expected to be settled through forgiveness of sums due from CSUN by Sunergy Shanghai since its formation.

Stephen Cai, CEO of China Sunergy said: "The sale of Sunergy Shanghai follows an extensive and thoughtful evaluation of potential options relating to the sale of Sunergy Shanghai, and we fully expect the cash proceeds from the sale will further strengthen our working capital and enhance our operations. We believe these resulting improvements will contribute meaningful long-term rewards to the Company."

CSUN has undergone a period of cash flow liquidity issues, which the company had previously said had been resolved. CSUN had undertaken OEM module supply agreements in the third quarter of 2013 to tackle its working capital constraints.