Solar Sem to merge with Trans-India

HYDERABAD: Solar Semiconductor, the Hyderabad-based solar energy firm, has decided to merge with the US-based American Stock Exchange-listed Trans-India Acquisition Corporation.

The reverse merger plan is expected to provide Solar Sem with immediate access to the global capital markets as also to $92-million funds available with the US firm.

Hari Surapaneni, CEO, Solar Sem, said that Trans-India had raised money with the objective of integrating with a promising Indian company. “They found us and we were also keen on going ahead with the deal, with which we now get an indirect listing on the Amex,” he said.

Solar Sem had consolidated revenues of $15.2 million in the year ended March 2008, and $27.2 million in the September quarter. In the current fiscal, the company is expecting its topline to be $140 million. 

Solar Sem has been valued at $375 million. As part of the deal, its promoters will get Trans-India shares at $8 a share. The all-stock deal will also see Trans-India dropping its name and becoming part of Solar Sem.

Though the transaction won’t bring any cash to Solar Sem promoters, it would provide them access to the US firm’s cash reserves.

Solar Sem designs, manufactures and sells solar photovoltaic (PV) modules for industrial, commercial, public utility and residential applications internationally. The company has manufacturing plants in Hyderabad, with an annual capacity of 75 megawatt (mw) of module production, which the management believes makes Solar Sem the largest PV module producer in India.

The firm is nearing completion of a ‘campus’ facility with capacity for both PV modules and solar cell manufacturing. This facility is expected to add an additional PV module capacity of 120 mw by the first quarter of 2009, PV cell capacity of 30 mw by the second quarter of 2009, and another 30 mw by the fourth quarter of 2009. The new 50-acre facility is located in Fab City on the outskirts of Hyderabad.

“In this market, this is the best way to raise money. We need to expand quickly to meet our product delivery commitments and the capex plans have been very aggressive,” Surapaneni said.

Solar Sem needs $200 million for additional facilities in the next two years. “We have delivery backlogs of $2 billion for the next three years. Even at best capacity utilisation, our annualised deliveries will not exceed $300 million. There no way we can deliver unless we expand,” he said.

Bobba Venkatadri, president and CEO of Trans-India, said, “Solar Sem’s strategic positioning in the high growth-potential clean energy sector and its rapid expansion made us to merge both the companies to deliver attractive returns to our shareholders.”
k_ramana@dnaindia.net