Printed Electronics Now staff06.22.20
The Board of Directors of Meyer Burger is proposing an ordinary capital increase to the shareholders at an Extraordinary General Meeting to be held on July 10, 2020.
Within the framework of the capital increase, the company expects to raise gross proceeds of CHF 165 million.
At the Annual General Meeting held on May 13, 2020, Meyer Burger had announced that it was considering plans for establishing an own large-scale cell and module production in Germany.
The reason for this fundamental change of direction is the realization that the company has not been able to generate profits from its technological leadership in recent years.
The company has shaped the development of photovoltaics along the entire value chain and has set the industry's essential standards, such as the diamond wire saw technology, the PERC technology and precision measurement technology for solar modules.
A large proportion of the solar modules produced worldwide today are based on technologies developed by Meyer Burger.
By selling its production equipment, however, Meyer Burger relinquished control of its technology and largely left the realization of the added value creation to its customers.
Meyer Burger’s Board of Directors has decided that Meyer Burger, as a rule, will in the future manufacture production equipment for Heterojunction/SmartWire exclusively for its own use and aims to become a leading global producer of solar cells and modules.
Consequently, the entire value chain will remain with Meyer Burger. The protection of the proprietary technology and the know-how can thus be strengthened, and future improvements of the production facilities will no longer be shared with third parties. The standard equipment and service business will be continued unchanged.
After careful considerations of the available strategic options, the Board of Directors of the company has decided to pursue a business model focused on its own production of cells and modules.
Unfortunately, Meyer Burger was not able to agree on a mutually beneficial co-operation with REC Group within the given time, as the conditions of the Memorandum of Understanding with REC Group (“MoU”) were eventually not met by REC Group to date. As a result, the Board of Directors of Meyer Burger has decided to no longer pursue this strategic option.
"The change of our business strategy from equipment supplier to a vertically integrated cell and module manufacturer is the right and logical next step to secure an appropriate share of the value pool that our globally leading technology generates," said Franz Richter, chairman of the Board of Directors of Meyer Burger Technology Ltd.
With Heterojunction/SmartWire, Meyer Burger has developed next-generation photovoltaic technology and has made it ready for the market.
The Heterojunction/SmartWire technology has higher conversion efficiency and higher energy yield than the current standard Mono-PERC and other heterojunction technologies currently available.
The high performance of the modules at comparatively low production costs is expected to enable us to enter both the high-margin and disproportionately fast-growing segment of rooftop systems and the more price-sensitive utility-scale segment. On this basis, the Board of Directors believes that the Company can achieve a unique position within the photovoltaic industry and can create substantial and sustainable added value for its shareholders through sizeable profit margins.
Meyer Burger delivered the proof of concept of heterojunction/SmartWire in mass production at the end of 2019 by successfully establishing a 600 MW production line for a client.
The proceeds from the capital increase are expected to be used primarily to build up production capacities and the sales organization.
Meyer Burger expects to save significant time and economic resources by acquiring existing production sites in Germany.
Meyer Burger intends to start production in the first half of 2021 and to expand it in consecutive steps in the following years.
The company has already secured several letters of intent from potential customers in Europe and the US to purchase a total of over 2 GW of cells and modules per year.
Initially, Meyer Burger envisages producing PV modules primarily for the attractive segment of rooftop systems. The company is targeting an annual production capacity of 400MW during this phase. The Board of Directors expects that this production volume will already enable the newly positioned Meyer Burger Group to achieve an operating profit.
"The next technological step is comparable to the transition from 4G to 5G in mobile communications. Only Meyer Burger has brought the 5G technology of the PV industry to market maturity," CEO Gunter Erfurt said. "We can be in the market with our products within just one year. Our manufacturing in Europe is competitive and offers significant profit potential."
In line with the expected demand for MBTN's high-quality products, Meyer Burger intends to increase annual capacity to 1.4 GW of cell and 0.8 GW of module production by the beginning of 2022 by raising a total of around CHF 180 million of debt in 2021/22. On this basis, Meyer Burger expects annual sales of CHF400-CHF 450 million and an EBITDA margin of 25-30% within three years.
In the longer term, the company aims to expand annual production capacity to at least 5 GW. Depending on market demand, additional module production facilities are planned in Europe and North America which shall be supplied from a central cell production. Meyer Burger then also expects to gradually increase its market share in the utility-scale segment.
