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Bankrupted Q-Cells Bought Out

German Q-Cells was once the world’s largest manufacturer of silicon solar technology. However, due to the financial market crash and the rise of well-financed Chinese solar cell makers, the company was forced to declare insolvency in April of this year.

After some fierce competition from various companies, Q-Cells has now been sold to the South Korean company, Hanwha. The creditors of the German company agreed to the sale with a vote on Wednesday, though the sale still requires regulatory approval before its finalized. At today’s creditor meeting in Dessau-Rosslau, the creditors of Q-Cells SE approved by a large majority the sale of the business operations to South Korean conglomerate Hanwha. Insolvency administrator Henning Schorisch had signed the contract last Sunday.

Q-Cells are not the only casualty of the global economic crisis. Since December, at least six German solar technology companies have filed for insolvency amid increased competition and a glut of Chinese solar-modules that have dragged down prices.

Korean conglomerates have been prolific in scooping up many of the struggling solar companies in recent years. Hanwha took over China-based Solarfun Power and renamed it Hanwha SolarOne. It invested in several American start-ups, a solar energy system developer tenKsolar, installer OneRoof Energy and silicon wafer makers 1366 Technologies and Crystal Solar. Hanwha bought Solar Monkey to enter the power plant development business — the company formally announced its entry earlier this summer. It also invested in energy storage developer Silent Power.

As part of a “transferred restructuring process”, Hanwha Group takes over 1250 employees out of a total headcount of roughly 1550 as well as most parts of the total Q-Cells Group in Germany. This pertains to the site in Bitterfeld-Wolfen with solar cell and solar module research, development and production as well as the administration site in Berlin; the production site in Malaysia with an unchanged number of about 500 employees as well as some international sales companies. The integration will mainly lead to job cuts in Q.Cells’ administration division, as there is considerable overlap with the organisational structure of the Hanwha Group.

The purchase price is composed of the takeover of operational liabilities in the lower triple-digit millions as well as a cash component in the mid double-digit millions, while the cash component depends on the volume of additional liabilities that will have to be taken over. The purchase agreement is still subject to the approval of the relevant anti-trust authorities. The transaction is managed by Deloitte & Touche Corporate Finance GmbH as the exclusive M&A consultant for both, the insolvency administrator and the company.

“Hanwha is a big player in the solar industry, so the deal might fit,” Ingo Queiser, an analyst at Natureo Finance, said by phone.

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