SolarWorld AG: SolarWorld expands globally with addition of Shell Solar crystalline operations02-02-06v3
Subject to the approval of the anti-trust authorities, SolarWorld AG (ISIN: DE0005108401) will assume a 100% equity interest in the crystalline solar activities of the Shell Group. The sale and purchase agreement signed by both parties results in the transfer of the following Shell locations: Vancouver, Washington and Camarillo, California, which manufacture solar silicon crystals, wafers, cells and modules, Gelsenkirchen, Germany, which produces solar cells, as well as the sales companies in Munich, Germany, Singapore and South Africa and the research and development team focusing on silicon technology based in Munich, Germany. The production capacities that will be transferred to the SolarWorld Group under this agreement amount to some 80 Megawatt (MW). The Shell Solar Rural business is not included in the transaction. The parties have agreed not to disclose the financial conditions of the deal.Information and Explaination of the Issuer to this News:
SolarWorld AG to become Number One in the US solar market
With this additional capacity, SolarWorld AG will rise to become the largest producer of solar power technology in the USA. “In view of the recently launched comprehensive funding program in California, the SolarWorld Group will benefit from excellent growth opportunities with this expansion, creating a global ‘SolarWorld’ with production and sales representation in the most vigorously growing solar markets worldwide“, says Dipl.-Ing. Frank H. Asbeck, Chairman and CEO of SolarWorld AG. In Camarillo, California the Shell Group operates an integrated wafer, cell and module production facility that will in future be run by SolarWorld AG under the name SolarWorld Industries. In Vancouver/Washington, in the Northwest of the USA, there is an additional production facility for mono-crystalline solar silicon ingots. The mono-crystalline solar technology guarantees the highest yields and thus provides the needed efficiency at the raw material side. The modern solar cell factory in Gelsenkirchen provides an ideal supplement to the high quality cell production of the SolarWorld Group in Freiberg. By way of the new sales activities in South Africa and Singapore, SolarWorld AG will establish a presence in the promising markets of Asia and Africa.
Silicon supply secure
'This lucky deal represents a focused approach of expanding capacity and presence in the most expanding solar markets worldwide. These operations will fit well within our portfolio and further strengthen our ability to meet the world’s growing demand for solar energy alternatives“, explains Frank H. Asbeck. 'We expect the lower throughput at the sites, due to the silicon supply situation, will end in the near future. In parallel to the new raw materials that are included in the transaction, we will make silicon supplies available to the US and/or German locations. At the beginning, we expect capacity utilization of approximately 50% at the new locations. Under current plans, we hope to bring production up to full capacity by 2007/2008. The expansion plans that the SolarWorld Group has in Freiberg will not be affected by the addition of these new facilities“.
Support provided to Rural business Shell Solar’s Rural business, which provides home energy solutions in rural markets, will remain with Shell. However, recognizing the impact that this business has on the quality of life in the areas in which it operates, SolarWorld has agreed to supply modules to support the continued growth of this business.
Employees are retained
SolarWorld AG expects to continue to employ the 575 Shell staff. There will in fact be a one-year employment guarantee for all persons. “We also want to retain the employees beyond that point. We assume that capacity utilization in the new factories will go up continuously and that by the end of the relative raw material scarcity in 2008 the majority of the employment contracts will be secure. Since our establishment in the year 1998 we have consistently added new staff. We want to keep it that way.” For Shell Solar customers nothing will change. In the future they will be serviced by SolarWorld AG, as reliably as before.
Frank Asbeck: Possibly the first and last mega merger in the international solar market
'The transfer of Shell Solar to SolarWorld AG reflects the consolidation in the industry that has been emerging for some time,” is Frank Asbeck’s assessment of the deal from a market perspective. But it could be that for the foreseeable future this was the first and last major merger in the international solar market. “The other big international players are firmly in place. Big corporations with a lot of capital clout are behind them. From today’s point of view it is difficult to imagine that one of these large players might disappear from the market through a take-over“. On the other hand, consolidations and takeovers in the segments that require less capital and know-how of the solar power market, like solar cell and solar module production, were likely as well as in the field of trading and Research & Development companies.