Under the terms of the agreement, Trina Solar will hold a 51% stake in Hubei Hongyuan with the remaining 49% stake held by Shenzhen (or Shenzhen S.C. New Energy Technology Corporation), a leading solar equipment manufacturer.
Subsequent to the transaction, Hubei Hongyuan will change its name to Hubei Trina Solar Co., Ltd.
The new joint venture company will expand Hubei Hongyuan's existing production facilities and infrastructure to achieve an expected capacity of 420 MW by the middle of 2014.
"This acquisition will provide Trina Solar with the benefit of greater access to solar cell manufacturing capacity and at a low cost of capital," said Mr. Jifan Gao, chairman and CEO of Trina Solar. "Shenzhen S.C. and Hubei Hongyuan have extensive and proven experience in manufacturing superior quality solar equipment and products, respectively."
Mr. Liujian Jiang, chairman of Shenzhen S.C., concurred, adding that the transaction will enhance the presence of both companies within the solar sector "by bringing together Trina Solar's solid experience and industry-leading products and services with Shenzhen S.C.'s state-of-the-art equipment."