In the capital increase, LDK Solar will subscribe for a total of 5.79 million new shares of Sunways to be issued against a cash contribution and contributions in kind. The issue amount of the shares to be granted against the cash contribution amounts to a total of euro 2,201,805.50. Simultaneously, LDK Solar has announced its intention to submit to the Sunways shareholders a public takeover offer for all outstanding shares in the company. Subject to the approval of the offers publication by the Federal Financial Supervisory Authority (Bundesanstalt fur Finanzdienstleistungsaufsicht – BaFin), the takeover offer is expected to be published in late January 2012. Under this offer, a cash consideration of euro 1.90 per share is to be offered to the Sunways shareholders. Both the capital increase as well as the completion of the takeover offer must be formally cleared by the Federal Cartel Office (Bundeskartellamt). Following the clearance under the cartel law, the completion of the offer is currently expected to occur in the first quarter of 2012.
By way of the capital increase against contributions in kind, Sunways will acquire the indirect ownership of a company based in China. Through this China-based subsidiary, Sunways will have access to LDK Solars module production plants in China for the further joint development of high-performance solar modules cost-effectively.
As a part of the arrangements under the investment agreement signed on December 31, 2011, Sunways and LDK Solar have also agreed to terminate the formerly existing long-term contract for the supply of wafers by LDK Solar to Sunways. The wafer supply contract will, however, be reinstated if the capital increase should fail to be registered with the relevant German governmental authorities by June 30, 2012.
LDK Solar, despite its investment in Sunways and the takeover offer, has no intention to cause any delisting of Sunways shares from the Frankfurt Stock exchange or any other trading forum. Neither does LDK Solar intend to interfere with the Sunways brand.
Xiaofeng Peng, Chairman, CEO and founder of LDK Solar is convinced of the prospect of a successful cooperation between LDK Solar and Sunways. "We are investing in Sunways because we are convinced of the synergies of our two companies in light of our and Sunways products and business models. We also believe in the market potential of the Sunways brand. This is a perfect match for both sides."
Michael Wilhelm, the Chairman of the Management Board (CEO) of Sunways is also upbeat on the transaction. "We are happy that we have found in LDK a strategic anchor investor who shares our vision of the photovoltaic future and with whom we were able to develop over many years of intensive cooperation a relationship of trust with the highest appreciation and respect."
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