Ascent Solar Partners with China's TGF Radiant Group

Developer of solar photovoltaic (PV) modules Ascent Solar Technologies Inc. (NASDAQ: ASTI) has formed a partnership with China-based TFG Radiant Group that will result in $450 million of investment.

As part of the agreement, TGF Radiant has purchased $7.36 million in Ascent stock, making it the majority stakeholder with 56% ownership. Ascent has also agreed to make TGF Radiant the exclusive Eastern Asia distributor. In return, Ascent will receive license fees, non-recurring engineering fees and production milestone payments that over several years could top $250 million.

TGF Radiant is also committed to investing $165 million to build a fabrication facility (FAB) in China. Ascent will help develop and install the new facility which it will be part owner of.

This partnership is not totally new territory for the companies as TGF has already been the sole distributor of Ascent's PV modules in Asia for the last year. Inbo Lee, President and CEO of TFG Radiant, says he knows that Ascent products are what his company's customers want.

After a rocky year, this is a major development for Ascent. In late March 2011, the Thornton, Colorado-based company announced a new CEO and days later said it was changing its target market from the building applied and building integrated photovoltaic markets (BAPV/BIPV) to emerging and specialty markets.

However, this partnership agreement seemingly directly relates to the building integrated PV markets. TGF Radiant parent company Radiant Group operates metal roofing and facades companies in addition to real estate investment companies.

Ascent, which already operates two FABs in Colorado, plans to increase fabrication capacity in the U.S. In February, the Department of Energy notified the company that their $275 million loan guarantee application for the proposed 150MW FAB3 project had been selected to advance to the due diligence phase of review.

The company's 1.5 megawatt (MW) production line (FAB1) has been in production since 2009, and their 30 MW production facility (FAB2) came online in 2010.

Addressing the "transformative" agreement, Ascent Chairman Dr. Amit Kumar said:

"This partnership enables Ascent to pursue the building integrated and building applied photovoltaic markets with a partner that will finance and drive manufacturing, sales, marketing, distribution and installation. Ascent will receive ownership in the offshore FABs, and a royalty that will drop directly to our bottom line. Ascent will continue to develop and serve the premium markets through its current and future plants in the U.S. We will also seek similar partnerships for other geographies. Strategically, this type of partnership enables us to focus on R&D, and product and plant development, while our partners focus on scale up, cost reduction and commercialization."

Image Credit: Dave Dugdale via Flickr