Evergreen Solar Announces Expansion Plans For EverQ Using Quad Technology
Evergreen Solar, Inc. announced that Evergreen Solar, Renewable Energy Corp. ("REC"), and Q-Cells, equal partners in EverQ, have approved the construction of a third integrated wafer, cell and panel facility and that the partners have begun planning an initial public offering for EverQ.
The new EverQ facility will open in early 2009 in Thalheim, Germany, cost approximately €125 million, net of government grants, and increase EverQ’s production capacity from 100MW to approximately 180MW. The partners also agreed to expand EverQ’s production capacity to approximately 600MW by 2012. To support the further growth ambitions of EverQ to 600 MW, REC has offered an additional supply agreement for polysilicon of approximately 4,000 MT beginning in 2010 and continuing through 2015 at market pricing competitive with long-term contracts. Total polysilicon volumes supplied by REC to EverQ under the existing and new agreements could potentially reach 2,100 MT per year.
The new EverQ facility will license Evergreen Solar’s Quad furnace technology with its automated ribbon cutting technology. This wafer production process is said to provide substantial opportunity to further increase yield, cell efficiency and labor productivity as well as to further reduce String Ribbon’s already industry-leading silicon consumption. EverQ will pay a market-based royalty to Evergreen Solar for its current Quad technology based on actual cost savings realized by EverQ’s use of Evergreen Solar’s Quad technology.
Although the specific timing of an IPO is still to be determined, Evergreen Solar, REC, and Q-Cells have executed a binding memorandum of understanding detailing the required steps to prepare EverQ for its IPO.
As part of the preparations for the IPO, the management and organization of EverQ will be significantly strengthened to build EverQ into an independent company. The sales and marketing organization at EverQ will be expanded as the distribution of solar panels produced by EverQ will ultimately be marketed under a yet-to-be determined brand name. In the interim, EverQ will continue to provide Evergreen Solar-branded product to honor all current and future Evergreen Solar customer contracts and commitments until the transition is completed. At the same time, Evergreen Solar will work with EverQ management to develop a customer-focused marketing transition plan.
At the time of the IPO, Evergreen and EverQ will enter into a five year market-based royalty-bearing cross license to share all new material technology development on Evergreen Solar’s String Ribbon platform.
