SunEdison introduced the “asset-light strategy” to refocus its Solar Materials operations. LONGi, a China-based polysilicon and wafer maker, has signed to purchase the Kuching plant. At the same time, its subsidiary Lerri Solar also secured a multiple year PV module supply agreement with SunEdison Singapore.
SunEdison’s asset-light strategy includes selling its silicon wafer production facility in Kuching, Malaysia and closing its Pasadena, Texas polysilicon production facility. China’s LONGi announced that it will buy the Kuching portfolio, including the plant, slicing machine and other equipment, by US$63 million. Kuching plant’s total asset values at US$350 million with US$163 million net asset. During 2015, the annual revenue Kuching plant made was US$233 million, yet the net loss was US$1.33 million.
At the same time, LONGi signed to purchase a total of 20,000 tons of polysilicon over the next seven years from SunEdison Singapore. It is required for LONGi to buy at least 15,000 tons of polysilicon during the first four years.
Lerri Solar, a subsidiary of LONGi that focuses on producing mono-si PV cell and PV modules, signed to supply 3GW of mono-si PV modules to SunEdison Singapore within the following six years. The contracts requires SunEdison Singapore to purchase at least 2.1GW of PV modules during the first three years.
According to research and interviews conducted by EnergyTrend with Lerri Solar, the company and its parent company, LONGi, are focusing on producing mono-si PV products because of potential development. Lerri Solar plans to expand its PV cell production capacity to 2GW by the end of 2016 and PV module to 4GW by the same time. For a middle-term plan, Lerri Solar aims to have 5GW of PV cell capacity and 10GW of PV module capacity by 2019.
The contracts signed with SunEdison will help LONGi and Lerri Solar to expand its upstream production capacity as well as its downstream markets.