Leading Chinese Solar Company Selling GDR To Raise Money

• LONGi has announced plans to issue over 606.5 million GDRs on the Swiss Stock Exchange
• These would fetch around RMB 20 billion from international investors, representing not more than 8% of the company's share capital
• It plans to fund 88.75 GW of annual production capacity plans in China, Malaysia and Vietnam with the proceeds

LONGi Green Energy Technology from China intends to sell its global depository receipts (GDR) to raise an approximate RMB 20 billion ($2.8 billion) and fund its global capacity expansion plans, thus opening one of the world's largest solar PV manufacturing enterprises to international investors.

In a stock exchange notification, LONGi announced it will list the GDR on the Swiss Stock Exchange, with newly added domestic A shares as underlying securities. It will result into not more than 8% of the total share capital of the company's common stock.

Approximately 606.5 million shares to be issued as GDR can be converted into Chinese currency after 120 days of the listing, it added.

Money raised will be deployed by the company to fund 88.75 GW of following manufacturing projects with annual capacity targets of:

• 46 GW monocrystalline silicon ingot and wafers at Ordos, China
• 30 GW monocrystalline solar cell project in Ordos, China
• 6 GW monocrystalline silicon ingot project in Malaysia
• 8 GW monocrystalline solar module project in Malaysia, and
• 35 GW monocrystalline solar cell project in Vietnam.

According to Bloomberg, it will be the biggest ever GDR sale ever by a Chinese company and also the world's 2^nd largest listing in 2023, the largest being $4.4 billion initial public offering (IPO) of Kenvue in the US.

The manufacturer currently operating 133 GW wafers, 50 GW cells and 85 GW solar module capacity, aims to expand its annual production capacity to 190 GW, 110 GW and 130 GW by 2023-end. Recently, it started construction on 100 GW silicon wafer and 50 GW monocrystalline cell projects in China (see Work Starts For 150 GW Solar PV Capacity).

Amid escalating tensions between China and the US, at least 40 Chinese listed companies have announced plans to sell GDR, according to a local report by the South China Morning Post. It believes this attempt from Chinese companies to raise money outside of the US' Wall Street and NASDAQ is contributing to the rising prominence of the stock exchanges of London and Switzerland to raise capital. For Chinese firms, the move is aided by the Shanghai and Shenzhen exchanges facilitating GDR sales for companies listed at least for a year and market capital of over RMB 20 billion.

Speaking of LONGi, the world's largest solar silicon wafer supplier will be participating in Global PV System Technology Trends H1/2023 Virtual Conference of TaiyangNews on June 27-28, 2023 where we discuss the key takeaways from the world's largest solar trade shows SNEC Shanghai and Intersolar Munich. Register for the event free, here.