Solar cell maker Neo Solar Power Energy Corp (新日光能源) yesterday said it has received government support to finance a three-way merger in the latest restructuring efforts — worth NT$5 billion (US$168.92 million) — to boost profitability by penetrating all levels of the solar supply chain.
It is a strategy created by Neo Solar and local partners Gintech Energy Corp (昱晶能源) and Solartech Energy Corp (昇陽光電) to counteract price volatility in the solar cell market by rapidly diversifying into a lucrative solar system installation business.
“We are not forming a big solar cell alliance,” Neo Solar chairman Sam Hong (洪傳獻) told a media briefing yesterday. “We are creating a different business model — a winning formula — via this three-in-one merger.”
Photo: CNA
Within five years after the merger, the new entity, which is to be named United Renewable Energy Co (UREC, 聯合再生), seeks to generate between NT$90 billion and NT$100 billion in revenue, almost doubling current revenue of NT$50 billion, Neo Solar said.
The solar system installation business would be the greatest source of revenue at about 50 percent, while solar cell and solar module businesses would constitute the remaining 50 percent, the company said.
UREC aims to build solar power plants with a capacity of 1 gigawatt (GW) each year past the initial five-year period, said Gintech president Pan Wen-whe (潘文輝), who is to serve as chief executive officer.
The merger should be completed in the third quarter of this year, Hong said, adding that he did not expect the merger to face major obstacles from the world’s competition watchdogs as the new company would only install 5GW of solar cell capacity a year.
Hong’s remarks about creating a new business model is aimed at alleviating public concern that the government’s investment might end up with a zero return as all three solar cell makers are struggling to make a profit amid steep pricing competition from China and anti-dumping probes from the global community.
The government might inject more capital than the NT$4 billion fund into UREC through the government’s National Development Fund and government affiliate Yao Hua Glass Co (耀華玻璃).
The government fund and Yao Hua would each hold through a private placement less than 6.5 percent of the company’s shares, because the government wants to play a smaller role than UREC’s biggest private shareholder, Delta Electronics Inc (台達電), which is to hold a 6.5 percent stake.
UREC also plans to raise additional funds by issuing new shares.
The company is to concentrate on installing solar systems for clients, while manufacturing solar cells, solar modules and solar wafers at lower costs due to falling raw material sourcing costs and better productivity, Hong said.
IN THE AIR: While most companies said they were committed to North American operations, some added that production and costs would depend on the outcome of a US trade probe Leading local contract electronics makers Wistron Corp (緯創), Quanta Computer Inc (廣達), Inventec Corp (英業達) and Compal Electronics Inc (仁寶) are to maintain their North American expansion plans, despite Washington’s 20 percent tariff on Taiwanese goods. Wistron said it has long maintained a presence in the US, while distributing production across Taiwan, North America, Southeast Asia and Europe. The company is in talks with customers to align capacity with their site preferences, a company official told the Taipei Times by telephone on Friday. The company is still in talks with clients over who would bear the tariff costs, with the outcome pending further
NEGOTIATIONS: Semiconductors play an outsized role in Taiwan’s industrial and economic development and are a major driver of the Taiwan-US trade imbalance With US President Donald Trump threatening to impose tariffs on semiconductors, Taiwan is expected to face a significant challenge, as information and communications technology (ICT) products account for more than 70 percent of its exports to the US, Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) president Lien Hsien-ming (連賢明) said on Friday. Compared with other countries, semiconductors play a disproportionately large role in Taiwan’s industrial and economic development, Lien said. As the sixth-largest contributor to the US trade deficit, Taiwan recorded a US$73.9 billion trade surplus with the US last year — up from US$47.8 billion in 2023 — driven by strong
AI: Softbank’s stake increases in Nvidia and TSMC reflect Masayoshi Son’s effort to gain a foothold in key nodes of the AI value chain, from chip design to data infrastructure Softbank Group Corp is building up stakes in Nvidia Corp and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the latest reflection of founder Masayoshi Son’s focus on the tools and hardware underpinning artificial intelligence (AI). The Japanese technology investor raised its stake in Nvidia to about US$3 billion by the end of March, up from US$1 billion in the prior quarter, regulatory filings showed. It bought about US$330 million worth of TSMC shares and US$170 million in Oracle Corp, they showed. Softbank’s signature Vision Fund has also monetized almost US$2 billion of public and private assets in the first half of this year,
A proposed 100 percent tariff on chip imports announced by US President Donald Trump could shift more of Taiwan’s semiconductor production overseas, a Taiwan Institute of Economic Research (TIER) researcher said yesterday. Trump’s tariff policy will accelerate the global semiconductor industry’s pace to establish roots in the US, leading to higher supply chain costs and ultimately raising prices of consumer electronics and creating uncertainty for future market demand, Arisa Liu (劉佩真) at the institute’s Taiwan Industry Economics Database said in a telephone interview. Trump’s move signals his intention to "restore the glory of the US semiconductor industry," Liu noted, saying that
RSS