The first shot of mergers and acquisitions and restructuring in the photovoltaic industry has been fired.
Tongwei Shares (600438.SH), a photovoltaic enterprise with a market value of 84.4 billion yuan, announced on the 14th that it will acquire 51% of the shares of Runyang Shares, which ranks among the top five in the world in terms of photovoltaic cell shipments, through capital increase and agreement acquisition.
The total transaction consideration does not exceed 5 billion yuan.
After the completion of the transaction, Runyang Shares will become a subsidiary controlled by Tongwei Shares.
In the early morning of August 14th, the stock price of Tongwei Shares rose by 2%.
As of the time of the first financial reporter's manuscript, the stock price of Tongwei Shares rose by 0.92% to 18.74 yuan per share.
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The acquired Runyang Shares has established a production capacity of 55,000 tons of industrial silicon, 130,000 tons of polycrystalline silicon, 7GW pulling crystal, 10GW slicing, 57GW solar cells, and 13GW components, and has appropriately laid out some photovoltaic power station businesses, forming a complete industry chain from upstream industrial silicon to terminal photovoltaic power stations.
The core of this industry integration is still the integration of photovoltaic cell business.
In the era of P-type PERC, Tongwei Shares ranked first in the photovoltaic cell segment, and Runyang Shares ranked third.
According to the statistics of the industry organization InfoLink Consulting, in the ranking of global photovoltaic cell shipments in 2023, Runyang Shares ranks fifth, and Tongwei Shares ranks first.
The global advantage of Runyang Shares may be one of the reasons for Tongwei Shares to promote the acquisition.
According to Tongwei Shares, "after years of development, Runyang Shares has also built a competitive capacity layout in some overseas markets such as the United States, Thailand, and Vietnam, which can meet the traceability requirements of overseas markets."
According to the prospectus (registration draft) of Runyang Shares disclosed in June 2023, as of 2022, the company has four wholly-owned overseas subsidiaries, including Runyang Thailand (built a battery component production base in Thailand), Runyang International (responsible for battery sales), American Haibo Rui (responsible for component sales), and Runyang Germany (intended to engage in overseas photovoltaic business).
Opening up global sales channels is also a major goal of Tongwei Shares this year.
"The company plans to increase the proportion of overseas shipments from 6% in 2023 to 10% to 20% in 2024."
The management of Tongwei Shares said during the performance meeting of the first quarter.
However, from the perspective of the amount, the 5 billion yuan capital increase may be a "small deal" for Tongwei Shares, and it does not constitute a major asset restructuring.
As of the end of March 2024, Tongwei's monetary funds were about 28.3 billion yuan, and current assets were about 71 billion yuan.
In fact, against the background of the photovoltaic industry's continued bottoming out and clearing out, some industry insiders regard Tongwei Shares' acquisition of Runyang Shares as a positive signal of the industry's bottom and the beginning of clearing out, which is also consistent with the recent call of relevant departments to promote industry reshuffling through marketization means.
In mid-May this year, under the guidance of the Ministry of Industry and Information Technology's Electronic Information Department, the China Photovoltaic Industry Association organized the "High-quality Development Symposium of the Photovoltaic Industry."
The meeting pointed out that the photovoltaic industry is an industry with a very high degree of marketization, and it is more appropriate to solve the current industry difficulties through marketization means.
It specifically mentioned encouraging industry mergers and acquisitions and unblocking market exit mechanisms.
Wang Bohua, the honorary chairman of the China Photovoltaic Industry Association, publicly stated during the 2024 first half of the year review and the second half of the year outlook seminar held on July 25, "Enterprises should be cautious about new investments and encourage targeted acquisitions of new production capacity left by cross-border enterprises that have exited the industry."