The Circular contains important information including shareholder voting instructions, financial information for the combined entity, detailed financial and operating information about Hanwha QCELLS and a description of the strategic benefits of the transaction. The Company strongly recommends that all holders of Hanwha SolarOne’s ADSs and ordinary shares carefully read the Circular, and in particular, the risks described in “Risk Factors”in the Circular.
The Circular highlights, among other things, Q CELLS’ strengthening operational and financial performance:
- Revenue growth of 177% for the six months ended June 30, 2014 compared to the same period in the prior year
- A significant improvement in operating profit to US$7.8 million for the six months ended June 30, 2014 from US$33.2 million loss from same period in the prior year
The Circular also highlights financial benefits of the combination as compared to standalone Hanwha SolarOne (based on non-GAAP combined financial information as of June 30, 2014 and for the six month period then ended):
- Combined revenue will more than double to US$733 million
- Gross margin expansion to 14.5% (versus 11.7% for Hanwha SolarOne alone)
- Significantly improved working capital and operating cash flow
- 281% increase in cash to almost US$450 million
- Reduced debt-to-equity ratio to 232% (versus 377% for Hanwha SolarOne alone)
- 129% increase in shareholders’ equity to US$674.3 million
Mr. Seong Woo Nam, chairman and chief executive officer of Hanwha SolarOne, commented:
We believe that this combination creates a formidable global leader with strong combined financial performance that is well–positioned for long-term growth. The combined company will have a significant presence in the world’s most important solar markets and we look forward to executing our strategy to drive long-term shareholder value.
As stated in the December 8th, 2014 announcement, there are many strategic benefits of the transaction. Q CELLS brings industry-leading technology and R&D that can be leveraged across the combined product portfolio, as well as downstream expertise in development, engineering, procurement and construction (“EPC”) and project financing. At the same time, the combined company plans to further improve the combined company’s cost competitiveness by leveraging Hanwha SolarOne’s cost-efficient module manufacturing base together and Q CELLS’ industry-leading, highly efficient and fully automated cell manufacturing capabilities. Hanwha SolarOne believes that the combined scale and optimized global footprint will strengthen Hanwha SolarOne’s strategic and financial position and should enable Hanwha SolarOne to accelerate growth in the most important solar markets.
Mr. Nam also commented on the combined company’s broad geographic footprint and ability to service the US market free of tariffs.
We are well-positioned to provide high-quality and high-efficiency 72-cell modules to residential, commercial and utility markets in the U.S. by leveraging our globally diversified manufacturing locations in Germany, South Korea, Malaysia and Canada. We believe through these locations we can provide over 600 MW of tariff-free PV modules to the US in 2015. In addition, we expect to enter 2016 with well over 1 GW of tariff-free capacity to serve the US market, including 800 MW of module capacity in Malaysia we expect to become fully operational by the end of 2015.
ST Staff Writers
This post was prepared by Solar Thermal Magazine staff.