The family of GCL-Poly chairman and founder, Zhu Gongshan, already controlled more than 50% of Jiangsu Zhongneng, which is China’s largest manufacturer of polysilicon and wafers intended for use in photovoltaics, and one of the largest in the world.

GCL-Poly will fund the acquisition by putting up $200m in cash, selling $350m of secured notes, and issuing 10 million new shares at HK$2.20 each – a 12% discount over their closing price the day before the announcement.

Jiangsu Zhongneng, based in Xuzhou, Jiangsu, along China’s eastern coast, expects to produce 18,000 metric tonnes of polysilicon in 2009. Thanks to a series of planned upgrades, it will expand production to 21,000 metric tonnes in 2010.

The acquisition is seen as a way for GCL-Poly and its founder to consolidate their solar-power operations under one roof as political support for the technology, and renewable energy more generally, rapidly gains momentum in Beijing.

“Backed by strong government support, the future of the solar industry is promising, and the group is well positioned to capitalise on these opportunities,” says GCL-Poly chairman Gongshan.

GCL-Poly’s energy portfolio comprises 18 combined-heat-and-power (CHP) plants, one wind farm and one incineration plant.