Shares in troubled Norwegian solar energy firm REC soared on Thursday, fuelled by news of a major restructuring that will split its solar and silicon activities into two separate businesses and leave both listed on the Oslo Stock Exchange.
The decision follows months of uncertainity over the financial health of Renewable Energy Corp, once a shining star in the solar industry but lately clouded by indebtedness and investor pessimism.
Spinning off the solar business is expected to dramatically improve the company’s cash flow and calm fears about its future and “the ghost” of a soon-to-expire loan, analysts said.
According to website DN.no, all existing REC shareholders will be offered shares in the new solar company, while major owners like investor Øystein Stray Spetalen and investment firm Umoe have guaranteed that all REC solar shares will find an owner.
After the split, REC Silicon will be purely a producer of silicon, headquartered in the US. REC Solar, meanwhile, will make solar cell modules and wafers and have its head office in Singapore.