Sat, Oct 28, 2006 - Page 11 News List

MEMC, Gintech ink deal

WIN-WIN AGREEMENT The US-based company will get an interest-free loan and a parcel of land, while its partner in Taiwan will secure a supply of parts critical for its success

AGENCIES

MEMC Electronic Materials Inc agreed to supply silicon wafers to solar-cell maker Gintech Energy Corp (昱晶能源科技) as part of a 10-year contract expected to generate as much as US$3 billion in sales.

MEMC will receive an interest-free loan under the agreement with Taiwan-based Gintech to expand its manufacturing capacity, it said in a statement on Thursday.

MEMC also will get the opportunity to buy a 10 percent stake in Gintech, as well as acquire rights to a parcel of land of approximately 1.7 hectares located within the Hsinchu Science Park (新竹科學園區), the statement said.

MEMC, which had sales of US$1.1 billion last year, is expecting to sell solar wafers valued at US$7 billion to US$9 billion during the next decade, chief executive officer Nabeel Gareeb said in the statement.

Commenting on the agreement, Gintech's president and chief executive officer Scott Kuo (郭俊雄) said the long-term supply contract provides the company with a critical ingredient for success. In addition, the agreement represents how Taiwan's manufacturing excellence in semiconductors can also be translated into the growing solar industry, Kuo said.

St Peters, Missouri-based MEMC signed a multi-year agreement with Motech Industries Inc (茂迪), Taiwan's top solar cell maker, in April that's worth at least US$1.6 billion over the life of the deal.

Separately, Motech said in a filing with the Taiwan Stock Exchange on Wednesday that it has agreed to take a 10 percent stake in AE Polysilicon Corp as part of a deal that will also include supply of raw materials for five year.

The two companies have signed a letter of intent, the filing said. The deal will see US-based AE supply up to 2,400 tonnes of polysilicon per year starting in 2008, for which Motech will provide an undisclosed sum to be used to expand the company's production facilities, it added.

Financial terms of the deal were not disclosed.

"Polysilicon supplied by AE will still be less than half of total raw materials we need after our future expansion," Motech said.

"Motech will continue to buy polysilicon and other raw materials from other suppliers to satisfy future demand," it said.

The Taiwan firm has signed a NT$10 billion (US$305 million) supply agreement with Norwegian solar panel parts maker, Renewable Energy Corp.

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