Tongwei plans to acquire a majority stake in Runergy in a RMB 5 billion deal
It sees the acquisition strengthening its manufacturing footprint in overseas markets
Completion of the transaction will make Runergy a subsidiary of Tongwei
In what could be seen as a sign of the times to come regarding consolidation in the Chinese PV industry, polysilicon to modules manufacturer Tongwei Co. Ltd. has offered RMB 5 billion ($700 million) to acquire a majority stake in fellow vertically integrated manufacturer Runergy. The deal once complete, will make the latter a subsidiary of the Tongwei.
Under a capital increase intention agreement signed with Runergy, its shareholders and state-owned investment group Yueda Group, the latter will inject RMB 1 billion ($140 million) into Runergy through a capital increase.
Tongwei will then inject further capital into Runergy and simultaneously purchase RMB 1 billion equity from Yueda Group.
Runergy has annual production capacity of 55,000 tons of industrial silicon, 130,000 tons of polysilicon, 7 GW ingot, 10 GW wafer, 57 GW solar cells and 13 solar modules. Its manufacturing facilities are located in markets like the US, Thailand, and Vietnam, apart from China.
Among top 5 global solar cell suppliers on InfoLink Consulting’s list since 2019, Runergy for the 1st time was not among the top 5 in H1 2024. InfoLink attributes this to the turbulence in the industry and market fluctuations. Tongwei was 3rd on this list (see Top 5 Solar Cell Manufacturers, All Chinese, Shipped 78 GW In H1 2024).
Tongwei, on the other hand, has 650,000 tons/year of polysilicon production capacity, 95 GW for solar cells, and 75 GW for PV modules. In an announcement, Tongwei said Runergy’s competitive production capacity can meet the traceability requirements of overseas markets.
The management stressed that this acquisition can help Tongwei expand its overseas high-end premium market sales channels while effectively supplementing its overseas production capacity layout.
Due to the overcapacity of PV components in the global markets, module prices have declined significantly of late leading to several leading manufacturers cutting down their workforce and adjusting their production plans. The China Photovoltaic Industry Association (CPIA) recently pointed out that vertically integrated manufacturers stand to lose the most with the oversupply situation (see H1 2024 Chinese PV Export Volume Dropped By 35.4 Percent Annually, Says CPIA).
Recently, at SNEC 2024, Tongwei shared with TaiyangNews its latest TNC and THC module portfolio (see Tongwei’s Latest TOPCon & HJT Cell-Based Modules At SNEC 2024).
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