SunPower spins off production ops into Singapore-based firm

NEW YORK • SunPower, one of America's largest solar-panel makers, is giving up its manufacturing business to focus on installing rooftop systems.

The company is spinning off its panel production operations into a new company, Maxeon Solar, that will be based in Singapore with factories in France, Malaysia, Mexico and the Philippines, according to a statement on Monday.

As part of the deal, a Chinese supplier of silicon wafers will make a US$298 million (S$406 million) equity investment, valuing Maxeon at US$1.03 billion.

SunPower described the move as a natural evolution of the maturing solar business. Panel makers once had to help create their own market by installing the equipment they manufactured. Now the market is big enough for companies to specialise in one or the other.

"As the industry gets bigger, you get companies that specialise," chief executive officer Tom Werner said in an interview. "It's part of the mainstreaming of solar."

The spin-off means the United States is losing a major panel maker just as President Donald Trump tries to preserve solar manufacturing jobs at home. The Trump administration imposed tariffs on solar equipment imports last year in an effort to provide domestic manufacturers with a level playing field.

SunPower had won an exemption to the duties for the panels it made overseas because of the premium, high-efficiency nature of its products.

Mr Werner will continue to run SunPower, based in San Jose, and hold on to a small panel factory in Oregon. Mr Jeff Waters, who leads SunPower's technologies business unit, will become CEO of Maxeon, after the tax-free spin-off is complete in the second quarter.

SunPower panels are known for being the most efficient in the industry, able to convert more of the energy in sunlight into electricity.

Tianjin Zhonghuan Semiconductor will own almost 29 per cent of Maxeon after its equity investment, and existing SunPower shareholders will own the rest.

SunPower is majority-owned by French oil giant Total.

SunPower said it will focus on installing residential and commercial rooftop solar projects.

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A version of this article appeared in the print edition of The Straits Times on November 13, 2019, with the headline 'SunPower spins off production ops into Singapore-based firm'. Print Edition | Subscribe