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MarketScreener Homepage  >  Equities  >  SHENZHEN STOCK EXCHANGE  >  Tianjin Zhonghuan Semiconductor Co Ltd    002129   CNE1000000B8

TIANJIN ZHONGHUAN SEMICONDUCTOR CO LTD

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SunPower to spin off solar panel manufacturing, shares rise

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11/11/2019 | 02:45pm EST
SunPower's recently acquired SolarWorld Hillsboro manufacturing plant is seen in Hillsboro

U.S. solar company SunPower said on Monday it will split into two publicly traded companies, separating most of its solar panel manufacturing operations from storage and energy services, sending its shares up as much as 15%.

The move was intended to boost value in SunPower shares, which are trading at the same level they were at two years ago. Monday's news was welcomed by investors, with shares up nearly 3.7% at $8.68 in afternoon trade.

The new solar panel company, named Maxeon Solar Technologies, will be headquartered in Singapore, with manufacturing operations in France, Malaysia, Mexico and the Philippines.

The remaining company will still be based in California and will retain the SunPower name. It will focus on catering to the growing residential and commercial rooftop solar installation markets in the United States through the company's network of hundreds of dealers. That company will also keep SunPower's new solar panel factory in Oregon.

"This transaction will also simplify both organizational structures, lowering costs, while improving efficiency and creating (two) more nimble companies," Chief Executive Officer Thomas Werner said on a conference call with analysts.

Werner will retain the CEO role at the company, while Jeff Waters, CEO of SunPower's Technologies business unit will head of Maxeon.

The separation will be through a tax-free spin‐off of all Maxeon Solar shares held by SunPower to the company's shareholders.

SunPower is majority owned by France's Total.

As part of the deal, SunPower's long-time partner Tianjin Zhonghuan Semiconductor Co will invest $298 million in Maxeon Solar and hold a 29% stake in the company, while SunPower shareholders will hold the rest.

At the time of separation, expected to be completed in the second quarter of 2020, the two businesses will enter into a multi-year exclusive supply agreement covering sales within the United States and Canada of products manufactured by Maxeon Solar.

Raymond James analyst Pavel Molchanov said the brokerage had a mixed perspective to the news.

"We have long looked at SunPower's vertical integration and broad geographic diversification as differentiating strengths rather than weaknesses: put another way, 'a feature, not a bug.'"

(Reporting by Arundhati Sarkar and additional reporting by Shradha Singh in Bengaluru; Editing by Marguerita Choy and Anil D'Silva)

By Arundhati Sarkar

Stocks mentioned in the article
ChangeLast1st jan.
SUNPOWER CORPORATION -5.44% 8.34 Delayed Quote.6.92%
TIANJIN ZHONGHUAN SEMICONDUCTOR CO LTD End-of-day quote.
TOTAL 0.67% 45.32 Real-time Quote.-8.03%
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Latest news on TIANJIN ZHONGHUAN SEMICOND
2019SunPower to Create Two Independent, Industry-Leading, Publicly-Traded Compani..
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2019SunPower to spin off solar panel manufacturing, shares rise
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More news
Financials (CNY)
Sales 2019 16 884 M
EBIT 2019 1 534 M
Net income 2019 1 117 M
Debt 2019 4 560 M
Yield 2019 0,30%
P/E ratio 2019 42,8x
P/E ratio 2020 27,7x
EV / Sales2019 3,01x
EV / Sales2020 2,23x
Capitalization 46 289 M
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 7
Average target price 14,02  CNY
Last Close Price 16,62  CNY
Spread / Highest target 9,33%
Spread / Average Target -15,7%
Spread / Lowest Target -50,1%
EPS Revisions
Managers
NameTitle
Yu Mao Qin General Manager & Director
Hao Ping Shen Chairman
Ke Fa Sheng Chairman-Supervisory Board
Chang Xu Zhang Chief Financial Officer, Director & Deputy GM
Shu Liang Gao Director, Chief Engineer & Deputy General Manager
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