August 03, 2006 | 4 Comments
China's major solar photovoltaic player, Suntech Power is making a move on the hot Japanese solar market by scooping up one the country's larger solar companies with an established presence.Suntech Power Holdings signed a definitive agreement to acquire MSK Corporation in a two-step cash and stock transaction. The move will give Suntech a ready-made photovoltaic (PV) module sales and distribution network in Japan, still one of the top two solar markets in the world. In the first step of the acquisition, which is expected to close in the third quarter 2006, Suntech will acquire a two-thirds equity interest in MSK for $107 million through a combination of subscription to new shares and purchase of existing shares. The balance of the consideration is based upon revenue targets for MSK and will be paid in the second step, which is anticipated to close by the end of 2007. ''While Japan is the world's largest single market for PV modules, it is also one of the most difficult markets for foreign players to enter,'' said Dr. Zhengrong Shi, Suntech's Chairman and CEO. ''We anticipate that this acquisition will give Suntech the advantage of MSK's nationwide sales and marketing platform in Japan, which we expect to leverage to grow our market share in this important market.'' Based on the 2006 Photovoltaic System Market Future Outlook Report, Japan is the most important market for solar energy in terms of both total installation and production of solar cells and modules with 53% of world production. The report also states that Japan is one of the fastest growing markets in the world -- posting 48% annual growth in 2005 in the production of PV cells and modules. MSK Corporation is one of Japan's largest PV manufacturers and one of the top-ranking companies in the building-integrated photovoltaics (BIPV) space. MSK provides customer-tailored PV products that give aesthetic finish to a building by replacing the conventional building materials. In addition, MSK provides turnkey solutions to its clients. Its services range from pre-system preliminary studies through to post-installation commissioning and maintenance. With more than 20 years of experience and good brand name in the PV business, MSK currently has approximately 260 employees, leading technical expertise and one of the world's largest PV module manufacturing plants with a production capacity of approximately 100 megawatts (MW) in Nagano, Japan. In 2005, MSK had annual production capacity of approximately 200 MW. ''MSK looks forward to continuing to provide commercial and industrial solar solutions to Japan and markets in other parts of the world with both advanced building integrated photovoltaics (BIPV) and other high-quality PV products," said Tadao Kasahara, CEO of MSK. "As a subsidiary of Suntech, MSK will be able to access Suntech's support in terms of advanced PV cell/module products and cost competitiveness, financial resources, and distribution channels as well as have the possibility of pioneering BIPV applications in the Chinese market.''
"As a subsidiary of Suntech, MSK will be able to access Suntech's support in terms of advanced PV cell/module products and cost competitiveness, financial resources, and distribution channels as well as have the possibility of pioneering BIPV applications in the Chinese market.'' -- Tadao Kasahara, MSK, CEO