Trina Solar nets $124M for debt, expansion

Changzhou, China-based Trina Solar (NYSE:TSL) said today it sold 4.5 million American depositary shares, netting the vertically integrated solar maker $123.9 million to reduce its debt and expand its production facilities.

Trina manufactures ingots, wafers, cells, and photovoltaic modules. The company plans to reach production capacity of 400 megawatts of solar modules this year, up from 250 MW in mid-2008 (see Trina CEO expects 10x growth in China solar market). Trina's research, development and manufacturing operations in Changzhou occupy a site of approximately 152,526 square meters (1.6 million square feet), but the production expansion is expected to add about 161,475 square meters to its facilities.

Goldman Sachs and Credit Suisse Securities acted as bookrunners for the public offering, in which each American depositary share represented 100 ordinary shares. Shares of Trina closed trading today at $29.23, up more than 3 percent. 

Company officials said the new funds are also expected to allow Trina to repurchase up to $30 million of its 4-percent convertible senior notes due in 2013. In June, the company said it secured $57 million in credit facilities from Standard Chartered Bank China to help the company buy raw materials, sign sales contracts, and mitigate foreign exchange risks. 

Trina estimates that 10 MW of its 2009 sales are to be in China, up from 2 MW in 2008, thanks to the country's new $3-per-watt subsidy for installed solar that is expected to halve the cost for installations 50 kilowatts or more (see New solar subsidies in China set to reduce installed cost by half).

Earlier this summer, Trina announced plans to establish a warehouse in California in order to respond faster to its U.S. customers, which are expected to make up 15 percent of the company's 2009 sales (see Trina Solar’s new warehouse to serve growing U.S. market). Trina Solar also sells its products in Europe, Australia, and Asia.

Last week, Trina raised its shipment and gross margin forecasts for the second quarter because of improved conditions in the global solar market.