Suntech, JA in Latest Solar Rumblings 尚德与晶澳动作频仍

By newsdoug on July 4, 2011

There’s more noise coming from the solar sector as it adjusts to the new reality of oversupply that has seen panel prices drop steadily in recent months. Two of the sector’s major players, Suntech (NYSE: STP) and JA Solar (Nasdaq: JASO), have just announced major moves, reflecting a new reality JA Solar, Suntech at forefront of overhaul that has forced them to lower costs by adopting more flexible sourcing models and attaining better economies of scale. In Suntech’s case, the company announced it was ending a 10-year solar wafer supply agreement with MEMC just halfway through the agreement. (company announcement) The original deal was signed by Suntech to ensure its supplies at then-reasonable cost when wafer prices were still steadily rising. Now prices are falling, and clearly the original deal makes much less sense for Suntech, even though it will incur more than $200 million in costs related to the early termination. In the second deal, JA Solar said it will buy wafer maker Silver Age for $172 million, a move it says will more than double its wafer-making capacity. (English article) This is the kind of move JA and other major players need to make to increase their economies of scale by acquiring smaller players and driving industry consolidation. I would look for more major moves like these two, including possibly an acquisition in the $1 billion or higher range, by the end of the year as these companies quickly wake up to the new reality that their industry needs to become more efficient in order to ensurer its long-term viability.

Bottom line: Suntech’s termination of a burdensome supply agreement and JA Solar’s purchase of a wafer maker mark the solar industry’s latest restructuring, which is set to accelerate.

太阳能行业已经供大於求，近几个月太阳能电池板价格稳步下降。尚德电力<STP.N>和晶澳太阳能<JASO.O>刚刚宣布大动作，说明现实情况逼迫它们采取更灵活的采购模式，并努力实现更好的规模效应。尚德电力宣布终止与美国MEMC公司的硅片供货合同，而这份为期10年的合同刚刚进行到一半。尚德当时签署该合同是想以合理的成本确保硅片供应，当时太阳能硅片市场价格还在稳步上升。如今市场价格正在下降，所以对於尚德电力来说就没有必要维持这份合同了，虽然终止合同会给它带来超过2亿美元的损失。晶澳太阳能称，它将以1.72亿美元收购银禧集团有限公司，这将使其硅片生产能力增加一倍以上。晶澳太阳能等公司需要收购较小型公司，推动行业整合，来扩大其规模经济效应。预计随着更多太阳能电池企业意识到行业现实状况，未来会出现更多类似尚德和晶澳这样的案例，还可能出现价值超过10亿美元的收购个案。

一句话：尚德电力宣布终止一份让其不堪重负的供货协议，晶澳太阳能收购一家硅片制造商，标志着太阳能行业整合重组势头正在加速。