GCL-Poly diversifies away from PV
China’s GCL-Poly, the world’s largest supplier of polysilicon and wafers to the PV industry, on Monday announced a joint venture with German chemicals giant Evonik Industries that will see it further diversify away from the solar business.
The deal will see a GCL-Poly subsidiary and Evonik build factories in Jiangsu province for fumed silica (used for adhesives and sealants in buildings and cars) and ultra-pure silicon tetrachloride (used in fiber optic cables).
With a planned 20,000 metric tonnes of annual capacity, the plants will be 40% owned by GCL-Poly, and are due on line in 2016. The deal still requires the approval of the relevant authorities, Hong Kong-listed GCL-Poly says.
The joint venture will use as its feedstock the byproducts from GCL-Poly’s polysilicon foundries, which collectively hold 65,000MT of annual capacity.
The deal “will enhance GCL-Poly’s overall competitiveness by diversifying the silicon products”, says chairman Zhu Gongshan.
Already among the most unusual and complex solar manufacturers in the world, GCL-Poly has consistently pushed to diversify away from its core polysilicon and wafering businesses in recent years.
The company lost HK$445.8m ($57.5m) last year, and has not turned in a full-year of profit since 2011.
The price of solar-grade polysilicon has fallen sharply in recent years, and after a modest uptick is expected to resume its fall by the end of 2014, according to analysts.
Three-quarters of the polysilicon GCL-Poly produces it then uses to make solar wafers, which are sold on to PV cell makers. Together, the sale of polysilicon and wafers accounted for more than 65% of GCL-Poly’s HK$25.5bn ($3.3bn) in revenues last year.
Yet GCL-Poly also operates a significant fleet of fossil fuel-fired power plants, has recently transformed into a developer of mega-PV projects in China, principally through its recent acquisition of separately listed Same Time Holdings (since renamed GCL New Energy).
GCL New Energy intends to bring more than 4GW of solar capacity on line in China over the next two and a half years.