Image: Tongwei
Tongwei announced plans to acquire 100% equity in domestic competitor Qinghai Lihao through a transaction combining share issuance and cash payment, alongside a proposed supporting fundraise, according to a trading suspension notice dated February 25.
The company stated that the proposed transaction remains at a preliminary stage. Tongwei has signed an intention agreement with the proposed sellers — Duan Yong and two limited partnerships, Hainan Zhuoyue Enterprise Management Partnership and Hainan Haoyue Enterprise Management Partnership. The final transaction parties and detailed terms will be disclosed in a subsequent transaction plan or formal report.
Tongwei emphasized that the acquisition is not expected to result in a change of control. It will not constitute a related-party transaction and, based on preliminary assessment, is not anticipated to qualify as a major asset restructuring under applicable regulations.
To prevent abnormal share price fluctuations amid uncertainties surrounding the deal, Tongwei suspended trading of its A-shares and related convertible bonds starting from market open on February 25. The suspension period is expected to last no more than 10 trading days.
Qinghai Lihao is a privately held joint-stock company established in 2021 and registered in Xining, Qinghai Province. Its business scope covers electronic materials manufacturing as well as related production and trading activities.
Industry sources describe Lihao as a fast-expanding polysilicon producer leveraging Qinghai’s abundant renewable energy resources.
Public reports indicate that its first-phase 50,000-metric-ton polysilicon project entered commissioning in 2022. Longer-term capacity targets have been reported to be significantly higher, although Tongwei’s announcement did not disclose specific production capacity figures or the proposed purchase price.
Tongwei noted that key aspects of the transaction — including valuation, definitive agreements, audit and appraisal results, and regulatory approvals — remain subject to further review and confirmation. The company also cautioned investors regarding potential execution risks associated with the proposed acquisition.
