Ascent Solar to sell stake, eyes China growth
Updated: 2011-08-16 09:45
US photovoltaic cell maker Ascent Solar Technologies Inc said it would sell a fifth of its shares to China's TFG Radiant Group and the two parties plan to set up manufacturing facilities in east Asia, in a deal valued at about $450 million, Reuters reported.
The deal will help the US cell maker to build its presence in fast-growing solar markets in east Asia, especially in China.
Many solar companies are looking at China as a potential market for their products as energy demand escalates. Kleinwort Benson Investors said it sees China emerging as the biggest solar market in the next three years, followed by the United States.
TFG will invest $165 million to set up its first facility for the making of photovoltaic modules in China. The facility is expected to have an initial annual production capacity of 100 megawatt (mW).
Ascent will get royalties on all sales from the China manufacturing facility, which it will partly own.
It will also receive license fees and milestone payments if certain production and cost goals are met. The total milestone payments could exceed $250 million over multiple years.
The company agreed to sell 6.4 million of its shares at $1.15 per share.
TFG, a joint venture between Radiant Group and Tertius Financial Group, will have the option buy an additional 9.5 million Ascent shares at $1.55 per share.
TFG can also initially appoint one member to Ascent's board of directors, Ascent said.
"The partnership with Ascent will strengthen our leadership position in innovative metal roofing and construction," TFG Chief Executive Inbo Lee said in a statement.
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