Publications

May 30, 2023 – Our research suggests that VSUN’s Europe entity, Vietnam Sunergy Europe GmbH (VSUN Europe) is likely operated entirely from Shanghai, China. The operations in Germany appear to be minimal and the company may be reselling competitor’s products. This is detailed in a brief report available below.   VSUNのヨーロッパ法人であるVietnam Sunergy Europe GmbH (VSUNヨーロッパ)は、中国の上海で運営されている可能性が高いことが判明しました。ドイツでの事業は最小限であり、競合他社製品を転売している会社である可能性があります。    

May 23, 2023 – In conjunction with this report Viceroy have published corporate registry filings for NA Global エヌエーグローバル, FUJI SOLAR and VSUN Power (Hong Kong) Company. Below are instructions for accessing these documents. 本レポートに関連して、Viceroyは、エヌエーグローバル、FUJI SOLAR、VSUN Power (Hong Kong) Companyの会社登記簿を公開しました。以下は、これらの書類へのアクセス方法の解説です。

May 19, 2023 – This report will detail the corporate filings our team has pulled from Japan and Hong Kong showing numerous undisclosed related party transactions with Abalance insiders. These transactions take place with dummy shell companies and unconsolidated subsidiaries of VSUN. Our research suggests that Abalance management and their CSUN associates have been embezzling assets and money from Abalance shareholders. The center of this web appears to be Abalance CEO Ryu Junsei who we believe must explain his involvement to shareholders. Fuji Solar, who accounts for over 90% of company revenues with its subsidiary VSUN, appears to be audited by a co-owner of the subsidiary, and not an independent third-party accounting firm. This report will also break down ridiculous valuation metrics applied to Abalance’s minor economic interests in fully consolidated subsidiaries. In our first report Viceroy highlighted the fact that despite fully consolidating VSUN, it is only entitled to ~43% of profits from its operations due to its holding structure. Abalance owns 51% of Fuji Solar which in-turn owns ~85% of VSUN. The data we have collected are all sourced from public registries and are independently verifiable at the cost of a few dollars. Our work is accurately referenced. Management has no room to deny the veracity of Viceroy’s work without directly addressing any of our concerns. [A Japanese translation of this report will be available shortly]

May 18, 2023 – On May 17, 2023, Abalance issued two unsatisfactory responses to concerns Viceroy raised in its report titled “Abalance – Turning Japanese? We really don’t think so". Management’s rebuttal does not deserve a response, however shareholders do. We will address every management denial, point-by-point, in the report below. Viceroy have also attempted to reach out to Abalance via email yesterday morning. Abalance have not responded, and in its subsequent response, claim we have not contacted them. Management vehemently denies that it trades with Chinese suppliers who utilize forced labor in Xinjiang. Viceroy have pulled specific and detailed VSUN import data which highlights and names its Chinese suppliers: Abalance cannot deny it conducts business with them. VSUN’s investment certificate’s operation schedule advises that the construction permit would be applied for in December 2022 – January 2023. Despite this, we have been unable to find any approved construction permits for the facility. A site visit conducted on the week ending May 12, 2023, no copies of the construction certificates were on display as required. Abalance was specifically identified by the USA Department of Commerce’s (DoC) solar module AD/CVD investigation as circumventing AD/CVD orders.  These orders have been in place since 2012. VSUN failed to respond to the DoC’s questionnaire, and was determined to be in breach of AD/CVD orders. Abalance state that its legal counsel and experts have provided appropriate explanations and responses the US DoC. As already discussed, this is patently untrue. The DoC have been extremely clear that VSUN’s submissions did not constitute an acceptable response. Abalance then bizarrely state that they are also complying with a Department of Justice (DoJ) investigation. We applaud the transparency (or faux pas) but to brag about complying with a previously unknown DoJ investigation is a weird PR tactic. Abalance acknowledge our concern that VSUN products are non-compliant and will be found in breach of AD/CVD orders post a grace period allowed by President Biden. This grace period is intended to not negatively affect live projects and give project managers in the USA time to source compliant modules. [A Japanese translated version of the report will be made available at a later time] We believe the company's statement is wholly inadequate in addressing the serious concerns raised in our first report.

May 17, 2023 - Abalance (TYO:3856) is a Japanese corporation which purports to be a solar panel manufacturer. Approximately 90% of the company’s revenues are derived from its Vietnamese subsidiary, Vietnam Sunergy Joint Stock Corporation (VSUN). Abalance’s golden goose, Vietnam Sunergy Joint Stock Company (VSUN), is a pass-through assembly plant for Chinese products. It serves the sole purpose of avoiding US Anti-Dumping and CounterVailing Duties (AD/CVD). VSUN’s Vietnamese facilities manufacturing capabilities are limited to the least technically complex later stages of solar panel assembly. VSUN import data shows that it purchases effectively all its components from Chinese suppliers, which it assembles in Vietnam to circumvent Anti-Dumping and Countervailing Duties in the USA: its major market. Abalance’s solar panels will be subject to crippling restrictions by the USA’s Department of Commerce (DoC) set to take effect in June 2024. These restrictions are aimed at companies in Vietnam, Thailand, Malaysia, and Cambodia functioning as pass-throughs for Chinese-made solar panels and components. VSUN was acquired by Abalance subsidiary Fuji Solar in 2019. It was previously a subsidiary of the China Sunergy Group (CSUN). CSUN was a US-listed Chinese solar panel supplier pretending to be a solar panel manufacturer. In reality, its business operations were more akin to a chop-shop. VSUN’s supply chain includes Chinese companies linked to forced labor camps in Xinjiang widely known to use the Uyghur ethnic minority as a forced labor workforce. Despite fully consolidating VSUN and stating it owns ~85% of VSUN, Abalance is only entitled to 43% of VSUN’s earnings (but apparently all the costs) due an opaque corporate structure. We believe Abalance is complicit in evading US AD/CVD order and will find itself shut out from the US in June 2024, if not sooner. The links between VSUN and CSUN are well known, and we believe the DoC will act on this matter. Abalance is extremely dependent on VSUN, making up 88% of sales in FY 2022. Even if VSUN’s cell manufacturing site is developed on-schedule and does not circumvent AD/CVD orders, production capacity will be more than halved for the medium-long term, destroying margins and shareholder value. VSUN appears to be substantially run by former CSUN partners. In light of these extreme risks, we believe that Abalance is not investible.   エーバランスは、ソーラーパネルメーカーを名乗る日本企業である。同社の収益の約90%は、ベトナムの子会社であるVietnam Sunergy Joint Stock Corporation (VSUN)から得られています。 エーバランスの黄金のガチョウであるVietnam Sunergy Joint Stock Company（VSUN）は、中国製品のパススルー組立工場である。米国のアンチダンピング関税とカウンターベーリング関税（AD/CVD）を回避することを唯一の目的としています。 VSUN社のベトナム工場は、製造能力がソーラーパネル組み立ての最も技術的に複雑でない後工程に限定されている。 VSUNの輸入データによると、主要市場である米国のアンチダンピング関税や相殺関税を回避するために、実質的にすべての部品を中国のサプライヤーから購入し、ベトナムで組み立てていることがわかる。 エーバランスのソーラーパネルは、2024年6月に施行される米国商務省（DoC）による厳しい規制の対象となります。この規制は、ベトナム、タイ、マレーシア、カンボジアの企業が中国製のソーラーパネルやコンポーネントのパススルーとして機能していることを対象としています。 VSUNは、2019年にエーバランスの子会社であるFUJI SOLARが買収した。以前はChina Sunergy Group (CSUN)の子会社だった。CSUNは米国に上場していた中国のソーラーパネルメーカーのふりをしたサプライヤーだった。実際には、その事業運営は、よりチョップショップ（盗んだ車を解体して部品を売る店）に近いものであった。 VSUNのサプライチェーンには、ウイグル族を強制労働力として使用することで広く知られている新疆ウイグル自治区の強制労働収容所と関係のある中国企業が含まれています。 VSUNを完全に統合し、VSUNの85％を所有していると表明しているにもかかわらず、エーバランスは意図的に不透明で複雑な国際的企業構造において、同社の43％しか所有していない。 我々は、エーバランスが米国のAD/CVD命令を回避することに加担しており、早ければ2024年6月に米国から締め出されることになると考えている。VSUN と CSUN の関係はよく知られており、DoC はこの件に関して行動を起こすと信じている。エーバランス は VSUN に極めて依存しており、2022 年度の売上高の 88％を占めている。 仮に、VSUNのセル生産拠点が予定通り開発され、AD/CVD命令を回避しなかったとしても、生産能力は中期的に半減以上となり、マージンや株主価値を破壊することになります。 VSUNは、CSUNの元パートナーによって実質的に運営されているようです。 これらの極端なリスクに鑑み、エーバランスは投資対象外であると判断しています。