China's JinkoSolar gets $35M

October 13, 2008

Silicon-wafer manufacturer looks at Israeli technology and international expansion ahead of IPO plans.

Shangrao, China-based JinkoSolar said today it raised $35 million in its second round of equity funding.

The round was led by the city of Shangrao, China Israel Value Capital, Shenzhen Capital Group and Israel's Pitango.

JinkoSolar, located in the Jiangxi province, uses a proprietary process involving recovered silicon materials and raw polysilicon to make silicon ingots, which the company makes into monocrystalline and multicrystalline wafers. JinkoSolar then sells the wafers for use in panels.
The company says it cuts wafers more thinly than competitors, which yields more wafers from the raw material and lowers the cost.

The price of polysilicon has been on the rise for the past seven years, recently hitting an all-time high of $400 per kilogram, according to ResearchInChina.

The new round of funding is expected to help the company access technologies from Israel and expand internationally, according to Chen Kang Ping, founder and CEO of JinkoSolar.

The investors said they are working to prepare JinkoSolar for an IPO on the Nasdaq "as soon as the markets are ready," according to Jin Haitao, chairman of Shenzhen Capital Group and general partner of China Israel Value Capital.

China Israel Value Capital's General Partner Ami Dotan said the company made the investment because JinkoSolar has secured long-term silicon supplies and sales contracts, "giving the company an edge over their competitors, especially due to the inconsistent silicon availability."

The solar market is likely to be oversupplied by late 2009 or early 2010, according to a report in September by Thomas Weisel Partners. The causes are an increasing polysilicon supply and rapid growth in the production capacity of silicon wafers. However, the report said, solar is still a healthy market, especially for companies with consistent silicon supplies and vertical integration.