German solar firm moves to wind

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A German solar energy company, SolarWorld, is raising fresh capital by means of a share emission which is to be invested in wind energy projects as well as research and development of solar technology.

The move into wind is a novel development at SolarWorld, prompted by the breathtaking performance of the German wind market over the last few years. The company believes that saturation point is far from reached and notes that the federal economy ministry believes that the installation of 10,000 MW of wind power by 2005 is possible.

SolarWorld has set it sights on the Eifel region in the south of inland Nordrhein-Westfalen where, in certain areas, wind conditions are similar to those found at the coast. The company's wind energy division, Asbeck Immobilien und Kraftwerksgesellschaft, the Asbeck property and power station company, has leased the best sites in the region where the wind potential is so far largely untapped. SolarWorld owns holds 80.2% of Asbeck.

Enercon and Tacke

By 2004, the company hopes to have 75 MW of wind capacity operating, with the first 15 MW wind station running before the end of 1999. It will consist of Enercon 1.5 MW and 500 kW turbines and Tacke Windenergie 1.5 MW and 600 kW turbines spread over five sites, says Oliver Ristau of SolarWorld. The sites will comprise: 1.8 MW at Heimbach, 3 MW at Hellenthal-Hahnenberg, 4.5 MW at Hellenthal-Kehr, 4.5 MW at Monschau and 1.2 MW at Niedeggen.

SolarWorld says that despite high amortisation costs its wind sector will operate in the black from the start. Rather than set up separate companies for each wind station in which limited partners take stakes, SolarWorld plans to retain ownership of the wind stations within the company for a sustained participation in the wind boom. The investments will be financed with the help of cheap credit from the German development bank Kreditanstalt für Wiederaufbau, the company says. SolarWorld's wind business is expected to yield a profit after tax of DEM 600,000 in 2000, rising to DEM 1.4 million in 2002 and over DEM 3 million in 2004.

Going public

The share emission began on June 21 and closes at the end of August. A total of 500,000 shares are available at DEM 13.75 each. The existing shareholders will not exercise their option rights for new shares so that after the share placement 16.67% of the shares will be in widespread holdings and 83.33% owned by the Asbeck family. SolarWorld is handling the share emission as a private placement. Shares will be allocated on a first come first served basis, the company says.

The Bonn-based company hopes that when the share subscription period is over, off the floor trading in SolarWorld shares will develop so that investors who missed the boat in the share emission process can invest in the company later on. This month the Asbecks plan to have the family company listed on the New Market division of the Frankfurt stock exchange.

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