Elkem plans IPO on Norway’s stock exchange to expand silicon business in China

Norwegian polysilicon manufacturer and silicon product provider, Elkem, a unit of Chinese chemical company, China National Bluestar Group, announced in a press release that it is planning to again be listed on the Norwegian stock Exchange (Oslo Børs).

Elkem specified that, through this operation, Bluestar’s unit, Bluestar Elkem International Co. Ltd. SO will reduce its stake in the company while remaining its largest shareholder.

With the funds raised through its IPO on Norway’s stock exchange, Elkem intends to buy Bluestar’s China-based units, Jiangxi Bluestar Xinghuo Silicones Co. Ltd (Xinghuo Silicones) and Bluestar Silicon Material Co. Ltd (Yongdeng Silicon Materials).

The first company owns and operates a factory with an annual capacity of 200,000-tons of organic silicon monomers and 80,000-tons of caustic soda; while the second company, which specializes in silicon metal production, operates two 25,500 KVA silicon metal furnaces, two 27,000 KVA ones and a 10,000 KVA one, with total annual capacity of 50,000 tons.

The announcement of the acquisition of the two factories was made by the company in June of last year, when it said the move would help it further support its integrated silicon value chain, from upstream quartz mining to silicon, silicones and downstream silicone specialities.

Elkem hopes to raise approximately 5 billion NOK (€509 million) through its initial public offering, which is expected to be launched in the first quarter of this year; and to involve institutional and retail investors in Norway, as well as certain institutional investors internationally.

“Over the last few years we have built on our position as one of the world leaders in environmentally responsible production of silicon-based advanced materials. We see an increasing demand for our solutions and are well positioned for further profitable growth. A listing of Elkem on Oslo Børs will enhance access to a diverse capital base and support our growth strategy,” said Elkem CEO, Helge Aasen.

“Elkem and the new Chinese business has approximately 6100 employees worldwide and had a combined, total operating income of NOK 21.4 billion, while Operating EBITDA amounted to NOK 3.2 billion for the year ended 31 December 2017,” the company added in its statement.

Elkem was delisted from the Olso Stock Exchange in 2005. Bluestar agreed to acquire the Elkem Group for around $2 billion in 2011. Later in March 2014, Hong Kong based financial investor, Guangyu International agreed to invest $200 million in new equity in Elkem Solar, which owns a 6,000 MT polysilicon factory in Kristiansand, southern Norway.

Bluestar also acquired Norway-based PV manufacturer, REC Solar ASA for 4,340 million NOK (around $554 million) in 2015.