Trina Solar Co., one of the largest Chinese companies in the field of renewable energy, has entered into an agreement to sell American solar cell production assets to Freyr Battery amid increased control over Chinese companies enjoying tax benefits in the United States under the climate law. This is reported in a press release from Trina Solar.
The deal includes Trina's new 5 GW solar panel assembly plant in Wilmer, Texas, which began production on November 1, and other manufacturing assets. Trina will retain a minority stake in Freyr after the deal closes, which is expected at the end of 2024.
In addition, Freyr, in cooperation with Trina, plans to build a 5 GW solar cell production plant in the second half of 2026, which should receive production tax benefits under the Inflation Reduction Act.
The transaction value is $340 million, including $100 million in cash, repayment of a loan in the amount of $50 million, a loan obligation in the amount of $150 million, 9.9% of Freyr common shares and a convertible loan obligation for 11.5% of Freyr shares. The company has also committed to issue preferred shares in the amount of $100 million to Capital Advisors LLC.
The transaction is subject to certain conditions, including regulatory approval, completion of the issue of preferred shares for Capital Advisors LLC and the reorganization, which should be completed by the end of 2024.
As a result of the transaction, a large American integrated company in the field of solar technology development will be created in accordance with a strategy aimed at the vertical integration of the solar energy business in the United States.
U.S. lawmakers are increasing pressure on Chinese companies to benefit from tax breaks under the Inflation Reduction Act, which subsidizes the production of solar panels, batteries and other renewable energy technologies.
Trina Solar Ltd. is an American subsidiary of the Chinese Trina Solar Co. for the production of solar energy and renewable energy sources with a commercial presence in the United States, global supply chains, advanced technologies and experience in manufacturing and implementing projects for American customers.
Trina Solar is a Chinese photovoltaic company and the third largest solar panel manufacturer in the world after Jinko Solar and JA Solar. The headquarters is located in Changzhou (Jiangsu Province, China).
Freyr Battery is a manufacturer of environmentally friendly energy solutions on an industrial scale with the aim of reducing global emissions and decarbonizing energy and transport systems. The company's shares are listed on the New York Stock Exchange. The headquarters is located in the state of Georgia (USA).
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