Suntech Power announced today that it purchased $8.1 million shares of Asia Silicon from an existing shareholder. This gives Suntech a minority stake in Asia Silicon.
The hope for solar panel maker Suntech is that by owing a part of Asian Silicon, Suntech will be able to lower its costs. Asian Silicon produces polysilicon and according to the release is ramping up production of a new “state-of-the-art polysilicon plant.”
Suntech’s cahirman and CEO, Dr. Zhengrong Shi, said in the release that by linking the two companies, “we believe that we will be able to achieve grid parity in many parts of the world within the next two or three years.” This is not the first time the two companies have overlapped. Asia Silicon has a seven year contract worth $1.5 billion signed in 2007, to provide polysilicon to Suntech.
This year is shaping up to be a tough year for solar companies, as demand will drop and there will be an excess of supply. Analysts are expecting a shake out in the industry will some companies folding or being acquired.