REC Silicon raises $20 million to bridge time until U.S.-China deal

REC Silicon’s fluidized bed reactor polysilicon plant in Moses Lake, Washington at dusk
The future of REC Silicon’s polysilicon plant in Moses Lake, Washington is hanging by a thread – Image: REC Silicon

U.S.-based and Norway-headquartered polysilicon manufacturer REC Silicon has raised NOK170.4 million (US$19.95 million) in gross proceeds through a private placement of 254,381,870 shares at a price of NOK0.67 per share. According to the company, the placement on April 9 was substantially oversubscribed.

The shares were sold by REC Silicon’s largest shareholder, Umoe AS, who will use the proceeds to buy new A-shares in REC Silicon. The polysilicon manufacturer will again use the net proceeds from the transaction “to strengthen and contain the Company's liquidity situation until access to the Chinese polysilicon market is restored.”

If the USA does not reach a satisfying deal in the trade talks with China, REC Silicon will curtail production at its fluidized bed reactor (FBR) polysilicon plant in Moses Lake on May 15 and shut it down by the end of June.

In the first quarter of 2019, REC Silicon sold 2,004 metric tons of polysilicon, 18.6% more than in Q4 2018, but 31% less than in Q1 2018. CEO Tore Torvund’s recent statement that the company’s solar division is “more or less without customers” was apparently an exaggeration to increase the pressure on U.S. negotiators.

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