Canadian Solar to List its Modules Biz on China’s Capital Markets

After a review of strategic alternatives available, Nasdaq-listed Canadian Solar on Monday said that its Board has decided to pursue a listing of it’s Modules and System Solutions (MSS) business on either Shanghai Stock Exchange’s Science and Technology Innovation Board (STAR market) or Shenzhen Stock Exchange’s ChiNext Market.

The decision was taken by a special committee of its independent directors after an assessment of the results of the strategic review, with the assistance of outside financial and legal advisors.

The company said that both STAR and ChiNext markets are intended to support innovative and fast-growing companies.

Further, the listing of modules business includes shares of the company’s principal China subsidiary and overseas sales subsidiaries.

Explaining about the board’s decision, Dr. Shawn Qu, Chairman and CEO of Canadian Solar, said that “this potential listing of our MSS in China will provide us a new platform to raise investment capital and strengthen our leading position in solar manufacturing. Meanwhile, by remaining listed on the NASDAQ as a Canadian company and partnering with long-term investors, we will continue to grow our solar project development platform in every major market around the world and reap the synergies from the two complementary businesses.”

However, the listing process is estimated to take around 18-24 months time frame.

“Canadian Solar shareholders, as owners of the China IPO issuer, will continue to own the solar manufacturing business and benefit from its potential growth upside. We appreciate China’s continued efforts to open its financial markets and welcome foreign issuers such as Canadian Solar,” Dr. Qu added.

As per the Chinese securities regulations, in order to qualify - the subsidiary is required to be converted into a Sino-foreign joint stock company prior to listing which would be completed through a round of equity raising from China-domiciled investors.