Norway-based polysilicon manufacturer REC Silicon was able to raise NOK 170 million (approximately $19.9 million) through a private placement of shares.
The company said the placement was largely oversubscribed, and that it sold 254,381,870 at a share of NOK 0.67.
“The net proceeds from the Private Placement will be used to strengthen and contain the Company’s liquidity situation until access to the Chinese polysilicon market is restored,” REC Silicon said in a statement. In particular, around $3.7 million should be devoted to curtail and shut down Moses Lake FBR production, in the United States, unless access to the China, where tariffs on polysilicon imports from the United States were introduced in 2014, will be restored. Furthermore, another $8.3 million is expected to be used for remaining payments to the Yulin joint venture, a project involving a 20,000 MT polysilicon factory in Yulin, in the Chinese province of Shaanxi.
In early February, REC Silicon said that its factory in Moses Lake, Washington, was operating at 25% of its production capacity, and would suspend production at the beginning of March . “The Board’s decision is subject to gaining further clarity on whether trade negotiations between the Governments of the United States and China are likely to result in REC regaining access to the China market for solar grade polysilicon and the overall outlook for the polysilicon market,” the company said at the time.
The factory operated at less than half its 18,000 metric ton (MT) capacity last year. REC Silicon was forced to lay off around 100 employees in July, and in September local members of the U.S. Congress wrote to President Trump warning of the plant’s impending closure, and urging the White House to “find an immediate resolution to the trade dispute over Chinese solar panels and American polysilicon”.
In 2018, REC Silicon posted a net loss of $341.6 million and an operating loss of 407.1 million. Its revenue declined from $272.4 million in 2017 to $221.2 million last year. It produced 9,280MT of polysilicon in 2018 at its two operating factories in Moses Lake and in Butte, Montana. In 2017, total production had reached 11,636 MT. “Overall, demand remained weak and excess capacity continued to place downward pressure on prices,” the company wrote in its financial statement in February. “Polysilicon producers continue to reduce capacity utilization to manage liquidity and there are signals that certain manufacturers will not resume operations.”