UNITED STATES – U.S. solar company, SunPower has revealed that it will split into two publicly traded companies, separating most of its solar panel manufacturing operations from storage and energy services.
The announcement resulted in a spike in the company’s share value sending its shares up as much as 15%.
The move according to a Reuters report was intended to boost value in SunPower shares, which have been trading at the same level they were at two years ago.
Pavel Molchanov, who is an analyst at Raymond James however said the brokerage had a mixed perspective to the news.
“We have long looked at SunPower’s vertical integration and broad geographic diversification as differentiating strengths rather than weaknesses: put another way, ‘a feature, not a bug.’”
The new solar panel company, named Maxeon Solar Technologies, will be headquartered in Singapore, and will oversee manufacturing operations in France, Malaysia, Mexico and the Philippines.
The remaining company will still be based in California and will retain the SunPower name and will keep SunPower’s new solar panel factory in Oregon.
It will also focus on catering to the growing residential and commercial rooftop solar installation markets in the United States through the company’s network of hundreds of dealers.
“This transaction will also simplify both organizational structures, lowering costs, while improving efficiency and creating (two) more nimble companies,” Chief Executive Officer Thomas Werner said on a conference call with analysts.
Werner will retain the CEO role at the company, while Jeff Waters, CEO of SunPower’s Technologies business unit will head of Maxeon, the company revealed.
The separation will be implemented through a tax-free spin‐off of all Maxeon Solar shares held by SunPower to the company’s shareholders.
In 2011, French Oil conglomerate, Total S.A. agreed to buy 60% of SunPower for US$1.38 billion. Its acquisition of SunPower catalyzed growth of the company through acquisitions.
Shortly after Total acquired a controlling stake at SunPower, the company acquired Tenesol SA and in 2013 SunPower acquired Greenbotics, Inc., maker of robotic solar panel cleaning products and services for large-scale solar power plants.
SunPower later in 2018 acquired SolarWorld Americas took over SolarWorld’s large manufacturing facility in Hillsboro, Oregon, to expand domestic manufacturing capabilities.
As part of the deal, SunPower’s long-time partner Tianjin Zhonghuan Semiconductor Co will invest $298 million in Maxeon Solar and hold a 29% stake in the company, while SunPower shareholders will hold the rest.
At the time of separation, expected to be completed in the second quarter of 2020, the two businesses will enter into a multi-year exclusive supply agreement covering sales within the United States and Canada of products manufactured by Maxeon Solar.