Taiwan-based solar cell manufacturer, Motech Industries, has announced its plan to merge with Topcell Solar International (TSI). After the merger, products would be sold under the Motech brand, and will see the company become the largest professional solar cell manufacturer in the world, with production capacity of 3 GW.
The merger, worth $64.5 million, will take place through a swap deal wherein six Topcell Solar commons stock shares would be exchanged for each Motech newly issued share. The deal is expected to close by 1st July 2015, provided all regulatory and stakeholder approvals are obtained.
According to a statement by Motech, this deal would offer enhanced solar cell technology to customers with better quality and operational efficiency. Additionally, Motech will have a stronger supply chain to create better profitability and growth momentum.
Taiwan’s first semiconductor company United Microelectronics Corporation presently have around 92% stake in TSI and it will become the second largest shareholder in Motech with a stake of 9% after merger deal.
Both the companies have failed to do well over the last few quarters and their sales declined drastically mainly because of the US anti-dumping duties. However, this deal would strengthen both the companies and would definitely provide tough competition to the other Taiwanese rivals in the growing Asian solar market.
Currently Motech’s has 1.1 GW production capacity in Taiwan and 700 MW in China, whereas TSI has 1.2 GW in Taiwan. Both companies agree that industry integration is the future in the solar equipment manufacturing market, thus, the cooperation between TSI and Motech is an important milestone of development in solar industry.
Image Credit: Motech Solar