India's JNNSM Phase 2 gets delayed due to Funding issues and Payment security concerns
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January 17, 2014Jinko Solar buys Topoint Solar Factories
Jinko Solar is all set to get the solar factories of Topoint group for a cheap price, as consolidation hits the Chinese solar industry. The solar boom in 2010 had led all sorts of industrial groups to enter the solar industry. Many of these new ventures neither have the requisite scale to be competitive nor the process manufacturing expertise. Cheap capital and land were the main drivers of the growth. However, the Chinese government is trying to consolidate the industry and remove the financial and other form of support for the small companies that have prolonged the industry glut.
Trina Solar recently tied up with the Yangang group to take over the module and cell manufacturing facility in a JV. This will mean very low capital expenditure by Trina, while allowing it to substantially add to its capacity. Note solar demand has been soaring in recent times, with Tier 1 manufacturers operating at >100% utilization. Smaller players have not benefit, as they run with uneconomical capacities.
This will give Jinko Solar access to 500 MW each of wafer and cell capacity, which means a 30% increase in capacity at minimal cost. There was a huge amount of capital expenditure on solar equipment in 2010 and 2011 by smaller companies. This top of the line new equipment is lying idle forcing some of the top solar equipment companies such as Meyer Berger, GT Advanced Technologies to retrench. Now these new mothballed capacity will be used by the top solar companies at a fraction of their buy prices.
JinkoSolar has acquired the manufacturing assets of the struggling Topoint group of companies.
Topoint, based in Haining, Zhejiang Province, is currently undergoing restructuring under the supervision of the Haining City government and the Haining City People’s Court.
The agreement will see Jinko acquire 500MW of cell and 500MW of wafer capacity plus 100MW of module capacity.
“Topoint’s high-quality assets, consisting of technologically advanced and recently purchased equipment, will enable us to cost-effectively meet the growing demand of our strong international customer base,” said Kangping Chen, CEO, JinkoSolar.t6g5f
“We believe that the geographic proximity of our existing facilities in Haining City with Topoint’s assets will allow us to leverage our existing logistical infrastructure to efficiently integrate Topoint’s assets,” he said.