Mon, Aug 27, 2007 - Page 12 News List

Kenmec readies solar initiative

HOTBED OF IMITATION Kenmec Mechanical Engineering Co is one of countless firms seeking to cash in on the positive sentiment surrounding the solar cell market

By Lisa Wang  /  STAFF REPORTER

Local thin-film-transistor (TFT) equipment supplier Kenmec Mechanical Engineering Co (廣運機械) will sign agreements with Centrotherm Thermal Solutions GmbH & Co on Wednesday to make solar cells using the German company's equipment and technology from next year, Kenmec said.

Centrotherm chief executive officer Hans Autenrieth will come to Taipei to ink the agreements, a press release said.

"Kenmec will work with Centrotherm in the industry to create a new era for both companies," the statement said.

The nation's biggest solar-cell makers -- Motech Industries Inc (茂迪) and E-ton Solar Cell Tech Co (益通光能) -- also use Centrotherm equipment.

share price

Shares of Kenmec rose NT$2.9 or 5.58 percent to close at NT$54.9 (US$1.66) on the GRETAI Securities Market on Friday. The stock has risen 37.25 percent since the beginning of the year, compared with an increase of 17.54 percent in the over-the-counter benchmark index.

In April, Kenmec's board approved a resolution to establish a solar cell affiliate, Tainergy Tech Co (太極能源科技). The manufacturer of solar modules was set up in mid-May on an initial capitalization of NT$5 million (US$151,600), making it one of a string of new solar investments made by Taiwanese electronics companies such as Mosel Vitelic Inc (茂矽) and CMC Magnetics Corp (中環).

Tainergy is set to start mass production at its plants in Chungli (中壢), Taoyuan County, in the first quarter of next year. The company plans to operate four production lines, with each line boasting an annual output of 60 megawatts.

To finance the construction of solar cell factories, Tainergy planned to raise NT$1.24 billion through the issuing of 49.5 million new shares at NT$25 per share, Kenmec said in a filing to the Taiwan Stock Exchange.

Kenmec will retain a 65 percent stake (NT$800 million) in Taingergy, the filing said.

Output

Output from the world's major solar cell makers is expected to expand by 30 percent annually to reach 2,820 megawatts in 2010, statistics compiled by the state-funded Industrial Technology Research Institute (ITRI, 工研院) show.

Revenues will increase to US$4.23 billion globally in 2010, up from US$11.2 billion in 2005, ITRI said. Taiwanese firms made US$200 million in revenues in 2005.

Kenmec is not alone in jumping on the solar bandwagon.

CMC, the world's second-largest maker of recordable compact discs, said last month it had invested NT$700 million to set up a solar cell company -- Sunwell Technology Corp (富陽光電).

Computer printed circuit board maker Unitech Printed Circuit Board Corp (燿華) also set up a new solar cell division.

Kenmec posted lower net income of NT$294 million, or NT$2.15 per share, for the first six months. This was a 5.5 percent decline from net income of NT$311 million, or NT$2.91 per share, in the same period of last year. Sales, however, climbed 19 percent year-on-year to NT$2.27 billion.

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