15 August 2011

Ascent allies with TFG Radiant on 100MW China CIGS PV fab  

Ascent Solar Technologies Inc of Thornton, CO, USA, which manufactures lightweight, flexible thin-film photovoltaic modules based on copper indium gallium diselenide (CIGS), has signed a long-term, multi-faceted, strategic partnership (worth more than $275m plus royalties) that includes (i) investments by TFG Radiant Group in Ascent and (ii) a joint development agreement to establish CIGS photovoltaic module manufacturing facilities to be located in East Asia. TFG Radiant has committed $165m for the initial fabrication plant, bringing the total deal to about $450m plus royalties.

TFG Radiant has purchased 6,400,000 shares of Ascent stock at a price of $1.15 per share (totaling $7.36m), which represents a premium of 56% on to the closing price of the stock on 12 August. Also, under certain conditions (including Ascent obtaining the approval of its shareholders plus TFG Radiant meeting performance requirements on the initial fab construction), it will receive the right to purchase a further 9,500,000 shares at a price of $1.55 per share ($14.7m). In connection, TFG Radiant has the right initially to appoint one member to Ascent’s board of directors, and is entitled to appoint a second member if its ownership percentage rises pursuant to the exercise of its stock purchase option.

Ascent has agreed to exclusively license its technology for fabrication and distribution of flexible, lightweight CIGS PV modules to TFG Radiant for East Asia (including China, Taiwan, Hong Kong, Malaysia, Indonesia, Thailand, Korea and Singapore). Ascent retains all rights for the USA and rest of the world.

Pursuant to the strategic alliance, in addition to continuing to ramp its existing fabs and improve its technology, Ascent will develop a next-generation PV production line in Colorado. Based on Ascent’s technology, TFG Radiant will build its first fabrication facility in China, with a projected direct investment of more than $165m. The fab is expected to have an initial annual production capacity of 100MW.

TFG Radiant will cover consulting costs for Ascent personnel in helping to install and bring online the fab in China. Ascent will receive partial ownership of the China fab and royalties on all sales from that fab. TFG Radiant also has the right to build, at its cost, multiple additional fabs for the East Asian markets and Ascent will receive partial ownership, royalties and consulting fees for all such fabs.

Ascent will receive license fees and non-recurring engineering fees from TFG Radiant, plus milestone payments (possibly exceeding $250m over multiple years) tied to the achievement of certain production and cost goals.

“This partnership is based on the complementary expertise of TFG Radiant, in metal roofing and construction in one of the world’s largest markets, and Ascent, in market leading flexible CIGS technology,” says Ascent's chairman Dr Amit Kumar. TFG Radiant Group is a joint venture of Radiant Group (a Chinese conglomerate in construction and real estate) and Tertius Financial Group (a private investment firm based in Singapore). With more than 3000 staff, the group operates businesses across China, Indonesia, Singapore and Malaysia, including in metal roofing and facades, import/export trading, real-estate investment, project management and consultation, new-energy development, manufacturing and distribution, and gold mining.

“This partnership enables Ascent to pursue the building-integrated and building-applied photovoltaic markets with a partner that will finance and drive manufacturing, sales, marketing, distribution and installation,” Kumar notes. Ascent will receive ownership in the offshore fabs, and a royalty that will drop directly to its bottom line. “Ascent will continue to develop and serve the premium markets through its current and future plants in the USA,” he adds. “We will also seek similar partnerships for other geographies. Strategically, this type of partnership enables us to focus on R&D, and product and plant development, while our partners focus on scale up, cost reduction and commercialization,” Kumar concludes.

“They bring expertise in innovative roof design and materials, balance of system design, volume manufacturing, and broad access to the East Asian markets,” says Ascent’s president & CEO Ron Eller about TFG Radiant. “While we continue to ramp our current Colorado fabs, this arrangement enables us to work with a key partner to build the first non-US and largest CIGS fab based on Ascent’s unique, flexible, monolithically integrated technology,” he adds. “TFG Radiant has the market leadership, distribution channels, installation capability and infrastructure, and established and highly motivated customer base that will accelerate the market for Ascent’s CIGS products in East Asia,” Eller believes.

“We have evaluated multiple PV technologies for roof-top and other applications. After an extensive review of Ascent’s PV technology and its ease of adoption to roofing applications, we are convinced that Ascent’s ultra-light flexible modules are the best for China and East Asia, which we expect to be the largest markets in the world,” says TFG Radiant’s president & CEO Inbo Lee. “Having been Ascent’s exclusive distributor in China for the past year, we know this is the product our customers want. The partnership with Ascent will strengthen our leadership position in innovative metal roofing and construction, and propel us to be the market leader in building-integrated, building-applied and other solar applications in the East Asia markets... This partnership is very important and strategic to our future growth.”

Tags: Ascent Solar CIGS

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