Tongwei was originally planning to invest CNY 5 billion ($ 700 million) to buy a 51% interest in Runergy.
Tongwei, a vertically integrated solar manufacturer in China, has decided to drop his plan to acquire a controlling interest in the China-based module producers.
The move marks the end of a potential deal of $ 700 million, which was in the making for six months. Tongwei was originally planning to invest CNY 5 billion ($ 700 million) to buy a 51% interest in Runergy. In a released statement, however, the company said that it would terminate its non-binding capital increase agreement with Runergy, so that the acquisition talks would be effectively terminated.
Despite a thorough due diligence, including business audits, legal assessments and multiple negotiating rounds, some commercial conditions remained unsolved, which caused the decision to leave the deal.
Runergy, one of the world’s largest independent suppliers of solar cells, has had financial difficulty. After the IPO was rejected by the Chinese Regulatory Commission (CSRC) in June 2024, the cash flow of the company deteriorated, aggravated by a sharp decrease in module prices. In response, YUEDA Group, a state -owned company in Yancheng, Jiangsu, CNY 1 billion ($ 140 million), who became the largest shareholder of Runergy and temporarily illuminated his financial pressure.
The interest of Tongwei in Runergie came from its substantial overseas production capacity, in particular in Southeast Asia, where Runergy factories in Thailand and Vietnam operates, as well as in the US, the acquisition would have enabled Tongwei to expand its international footprint, In addition to his domestic capacity. The recession in the solar industry, combined with increasing losses for Tongwei – was expected to be expected to leave the deal in 2024 CNY 7 to 7.5 billion ($ 1 to $ 1.05 billion) -.
Runergy’s ability to continue remains uncertain.
This content is protected by copyright and may not be reused. If you want to work with us and reuse part of our content, please contact: editors@pv-magazine.com.