by Paul Bonanos
[Posted on December 4, 2007 - 5:09 PM]
E-mail
del.icio.us
Technorati
DiggNew York's Good Energies Investments Ltd. has raised its stake in Nasdaq-traded Chinese photovoltaic cell vendor Solarfun Power Holdings Co. Ltd., providing a partial exit for Solarfun chief executive Lu Yonghua.
Good Energies, which invested for a 6.3% stake in Solarfun last year, will acquire the new shares from existing stakeholders, including Lu, who will sell half his stake. Pending approval and completion of the deal, Good Energies will own 34.7% of Solarfun's shares.
The stock, which closed Monday at $20.60, soared 27% to $26.25 on Tuesday.
Based on a market capitalization of $1.26 billion, the Good Energies stake is valued at about $437 million. Good Energies, a New York firm specializing in renewable energy, will receive another seat on the company's board of directors, alongside an additional new independent director.
Neither Good Energies nor Solarfun revealed the purchase price, but Solarfun said Good Energies purchased 66,745,638 ordinary shares and 281,011 American Depositary Shares in the transaction.
Lu will retain a 16.1% stake in Solarfun following completion of the deal. The company's annual report, dated July 2, described Lu as its largest shareholder, with a 32.2% stake.
Citigroup Venture Capital of New York held about 16.5% of Solarfun's shares at the time of the filing.
Qidong, China-based Solarfun develops silicon ingots as well as photovoltaic cells and modules used in solar power installations. A handful of customers, including Italy's SE Project SRL and Spain's Social Capital SL, account for the vast majority of Solarfun's revenues.
Launched in 2004 as a spinout from electric meter vendor Jiangsu Linyang Electronics Co. Ltd. of Qidong, Solarfun accepted $53 million in venture funding during the second quarter of 2006. In addition to Citigroup and Good Energies, investors included Hony Capital and Legend Capital, both of Beijing.
Solarfun listed on the Nasdaq in December 2006, selling 12 million of its American Depositary Shares to the public at $12.50 apiece.
Solarfun raised its full-year revenue outlook in late November and reported third quarter profits of 59.6 million renminbi ($8 million) on revenue of Rmb753.8 million ($100.6 million). The company's share price has since risen sharply from $11.05 on Nov. 27, before the income statement.
Scott Sonnenblick and Mat Lewis of Linklaters LLP advised Good Energies, while Alan Seem and Pingping Liu of Shearman & Sterling LLP were Solarfun's counsel. Milbank, Tweed, Hadley & McCloy LLP counseled Citibank Venture Capital, and DLA Piper advised Lu.
