Q-Cells and LDK Solar Announce Joint Venture

By Ucilia Wang

Q-Cells (QCSLF.PK) and LDK Solar (LDK) said they are forming a joint venture to develop large-scale power plants to buyers in Europe and China.

LDK Solar has been supplying silicon wafers to Q-Cells, which turns those wafers into solar cells and sell them to panel makers. Q-Cells said the joint venture would enable both companies to work more closely together and offer better deals to customers. The joint venture, LQ Energy, would contract with panel makers to produce the panels for the power plant projects.

Both companies also figured that they could take advantage of each other’s marketing know-how in their home territories. LDK is based in China while Q-Cells is Germany. The companies said they have started their first, 40-megawatt project in Europe, and are shopping for a buyer.

Both companies have been hit by the economic downturn. Q-Cells has cut sales forecast for 2009 twice since December. LDK has delayed a factory expansion plan and has had to deal with customers who can’t pay as promised.

LDK’s shares on the New York Stock Exchange rose 4 percent in recent trading to reach $7.06 per share.

Comments

[MikeyLV:]

I love that they are looking for a buyer. Nothing like producing product to be warehoused. It would be interesting to see what the cost per megawatt is for LQ Energy versus buying LDK wafers made into cells by Q-Cells.

Apr 12 04:58 PM

[Ming-Wei/Ming:]

I don't understand the short interest means. They increased 7% last month and covered in 2.6 days. No wander Eric kept his negative tune on LDK . The LDK had their long term contracts start in 2009, offset by the lower price of polysilicon and wafers.

Apr 13 11:01 AM

[kewlhand:]

It means they have the confidence in their cost/megawatt to build pre-emptivly. I take that as a sign they believe their finances are strong enough to do this kind of speculative business.

Apr 15 06:43 AM