Foreign-Currency Bond Follows $350 Million Raised in First Half
Global Investment Banks Named as Underwriters
Payment Guarantee Secured From Shinhan Bank
This article was published on the 26th at 3:50 p.m. on Signal, a capital markets service.
Hanwha Qcells’ plant in Cartersville, Georgia. Courtesy of Hanwha Group
Hanwha Q Cells America Holdings, the U.S. solar unit of Hanwha Solutions (009830), is seeking to raise 400 billion won in the global bond market. The move is read as an effort to accelerate the rollout of Solar Hub, its vertically integrated U.S. solar project, after a large rights offering and follow-up self-rescue measures at Hanwha Solutions improved its borrowing capacity.
Hanwha Q Cells America Holdings recently selected several global investment banks as underwriters and has begun procedures to issue dollar-denominated foreign-currency bonds within the fourth quarter, according to investment banking sources on the 26th. The expected size of the offering is $300 million, or about 410 billion won, and the company has secured a payment guarantee from Shinhan Bank. Because Hanwha Q Cells America Holdings does not have its own global credit rating, it needs credit enhancement from a financial institution to issue foreign-currency bonds.
This is the first time Hanwha Q Cells America Holdings has tapped the global bond market twice in a single year. In May, it raised $350 million, or about 515.6 billion won, with a guarantee from the Export-Import Bank of Korea. Orders in that book-building drew seven times the amount on offer, and the latest plan is seen as an attempt to complete the issuance before investor appetite cools.
The company’s plan to raise nearly 1 trillion won in the United States this year alone is closely tied to funding its local solar investments. It has completed a cell production line at its plant in Cartersville, Georgia, and began full-scale production of solar modules last month. The aim is to build a vertically integrated structure centered on the site by combining ingot, wafer, cell and module processes across the solar value chain. More than 3 trillion won has been poured into the plant since 2023, and investment is also under way to shift to high-efficiency, high-output products.
Borrowing capacity has improved considerably after parent company Hanwha Solutions completed a 1.1713 trillion won rights offering last month. Hanwha Solutions plans to lower its debt-to-equity ratio and net borrowing dependence to 166.1% and 32.4% by the end of this year, from 196.3% and 38.1% at the end of last year, widening the base for supporting its subsidiaries. As part of self-rescue measures tied to the reduced size of the offering, Hanwha Q Cells America Holdings recently issued 300 billion won of redeemable convertible preferred shares to add capital.
The market expects the competitiveness of the U.S. solar business to move onto a solid footing on the back of parent support and the bond issuance. On a consolidated basis, Hanwha Q Cells America Holdings posted revenue of 4.1896 trillion won and operating profit of 499.3 billion won in the first half, improvements of about 67% and 32% from a year earlier. That accounted for 75% of total revenue booked by Hanwha Solutions’ Q Cells division in the first half of this year.