TPG Capital set to invest in Comtec Solar
April 28, 2011 Category Alternative energy, Environment
Comtec Solar Systems Group, a major Chinese maker of mono-crystalline solar wafers, says TPG Capital will invest up to HKD1.17 billion in the firm. TPG will subscribe to HKD780 million of unsecured convertible bonds due in 2016. The bonds are convertible into new ordinary Comtec shares at an initial conversion price of HKD3.90. TPG will also receive 95 million warrants with the right to subscribe for one ordinary share each, with an initial exercise price of HKD4.10 per warrant. The warrants have a maturity of five years. Comtec will raise HKD390 million if the warrants are all exercised. If the bonds are fully converted and warrants fully exercised, TPG will hold 295 million ordinary shares, or 21% of Comtec’s total enlarged issued share capital. Shanghai-based Comtec, which supplies wafers to solar cell and battery makers, said the proceeds would be used to expand its solar wafer production capacity. The company expected wafer production to reach 1,400 megawatt this year, up from its previous forecast of 1,000 MW, Comtec Chief Executive John Zhang said. Last year, Comtec increased production capacity to 600 MW from 200 MW in 2009. Revenue for the year was CNY1 billion, up 102% year on year, while net profit soared to CNY223 million from CNY25 million. The gross profit margin increased to 32.4% from 10.9% a year earlier. Zhang expected solar wafer prices to fall 10% this year, but said Comtec would maintain a healthy profit margin through cutting costs by 15%. TPG, which has USD48 billion of assets under management, said this was its first solar investment in China.
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