Silicon material storage plan faces new changes, Tongwei Co., Ltd. plans to acquire Lihai Qingneng, also a shareholder of the storage platform

The ongoing silicon material storage and acquisition plan faced unexpected changes at the start of the year.

On the evening of February 24, Tongwei Co., Ltd. (600438.SH) announced that it is planning to purchase 100% equity of Qinghai Lihao Qingneng Co., Ltd. (“Lihao Qingneng”) through issuing shares and paying cash, and is raising supporting funds.

Both parties involved in this transaction are shareholders of Beijing Guanghe Qiancheng Technology Co., Ltd. (“Guanghe Qiancheng”), a silicon storage platform company.

Several industry insiders were surprised by this merger news, and individuals close to Lihao Qingneng’s minor shareholders told Shell Finance that they had not heard of any such acquisition before.

Silicon Material Dark Horse Lihao Qingneng: Chairman Comes from Tongwei, Chint as Largest Shareholder

Tongwei announced that the transaction is still in the planning stage. The company has signed a Letter of Intent for equity acquisition with potential partners Duan Yong, Hainan Zhuoyue Enterprise Management Partnership (Limited Partnership), and Hainan Haoyue Enterprise Management Partnership (Limited Partnership).

Known as a dark horse in silicon materials, Lihao Qingneng was established in 2021 and is a key investment project in Qinghai Province. It mainly engages in R&D, production, and sales of photovoltaic-grade high-purity silicon and electronic-grade polysilicon. According to its official website, Lihao Qingneng plans to invest a total of 20 billion yuan to build an annual production capacity of 200,000 tons of photovoltaic-grade high-purity silicon and 2,000 tons of electronic-grade high-purity silicon. In 2023, Lihao Qingneng expanded its capacity in Yibin, Sichuan.

Within the silicon industry, Lihao Qingneng is considered a leading player. According to industry data, its current capacity ranks behind top manufacturers Tongwei, GCL Technology, Daqo New Energy, and Xintech Energy. If this acquisition is completed, Tongwei’s market share in silicon materials will be further increased.

Lihao Qingneng has gained numerous industry accolades during its rapid development. Its core figure, current Chairman Duan Yong, previously worked at another leading silicon company, Oriental Hope, and later served as Chairman of Sichuan Yongxiang, a silicon subsidiary of Tongwei. The management team also includes veterans from the silicon industry.

Among Lihao Qingneng’s shareholders are well-known photovoltaic companies and venture capital institutions.

Chint New Energy is currently the largest shareholder, holding 10.08%. Wenzhou Huitai Investment Management Co., Ltd., controlled personally by Chint Group founder Nan Cunhui, holds an additional 3.59%, and Chairman Lu Chuan owns 0.36%.

Shaoxing Shangyu Jingsheng Investment Management Consulting Co., Ltd., whose senior management includes Cao Jianwei, Chairman of Jingsheng Electric (300316.SZ), and He Jun, President, owns 4.09%. Aisun Co., Ltd. (600732.SH) also indirectly holds 2.74% of Lihao Qingneng.

Notable investment firms like IDG participated in Lihao Qingneng’s Series A and B funding rounds. Zhejiang Minsheng Investment Group and Changjiang Securities’ Changjiang Securities Innovation Investment are also shareholders.

In late 2024, there were reports that Lihao Qingneng planned to list in Hong Kong, but due to ongoing market and financing environment changes, the IPO has not progressed.

Uncertainty in Silicon Material Storage and Why Tongwei Is Counter-Cyclically Acquiring

Both Tongwei and Lihao Qingneng are shareholders of Beijing Guanghe Qiancheng Technology Co., Ltd. (“Guanghe Qiancheng”), each holding 30.35% and 5.13% respectively through subsidiaries.

Amid the overall supply-demand mismatch in the new energy sector, the silicon storage plan, initiated as a self-rescue measure by the photovoltaic industry, has attracted high market attention since it was first announced last May. The core idea is for leading silicon companies to establish holding platforms to acquire capacity from remaining companies, thereby addressing supply-demand imbalances from the supply side. While this plan is highly anticipated by silicon companies, it has also faced turbulence due to complex interests among involved parties.

In January, the State Administration for Market Regulation (SAMR) held a meeting to discuss Guanghe Qiancheng’s potential involvement in controlling production and sales based on investment ratios and market segmentation. The debate over whether the silicon storage plan is anti-competition or anti-internal industry rivalry has added further uncertainty.

On February 5, Wang Shijiang, Deputy Director of the Electronic Information Department of the Ministry of Industry and Information Technology, stated at a photovoltaic industry review and outlook seminar organized by the China Photovoltaic Industry Association that combating industry internal competition will be a top priority this year.

Industry insiders told Shell Finance that the Ministry’s comments emphasize anti-internal competition, which can also be interpreted as a desire to avoid anti-monopoly issues.

The acquisition also raises concerns about Tongwei’s financial health, as the company has been experiencing continuous losses. After completing a Series B financing at the end of 2022, Lihao Qingneng’s valuation once reached 14 billion yuan. Although it has since shrunk, acquiring the entire company would still be a significant expenditure.

Tongwei previously forecasted that its net profit attributable to shareholders in 2025 would be around -9 billion to -10 billion yuan, a larger loss than the previous year. The company explained that while new photovoltaic installations are expected to grow year-over-year in 2025, the growth slowed significantly in the second half, with industry overcapacity issues persisting. The utilization rates across the supply chain are declining, and prices for key raw materials like silver continue to rise, while product prices continue to fall, exerting substantial industry pressure.

As of the end of Q3 2025, Tongwei’s total assets were 201.315 billion yuan, with cash and cash equivalents of 20.547 billion yuan.

Beijing Shell Finance Reporter Zhu Yueyi

Editor Yue Caizhou

Proofreader Mu Xiangtong