The first major equity acquisition deal in the solar industry for 2026 has been officially announced.
On the evening of January 16, leading solar company TCL Zhonghuan Renewable Energy Technology Co.,Ltd. (002129.SZ) announced its plan to invest in Dawn Solar Co., Ltd. to leverage relative advantages in technology, scale, and efficiency, accelerating the company's moderately integrated strategy.
The announcement further revealed that TCL Zhonghuan, as the investor, will invest in Dawn Solar through methods including share transfers, acceptance of voting rights delegation, and capital increases. In this transaction, major shareholders intend to transfer all or part of their shares in the target company, with specific transfer prices and transaction methods to be separately agreed upon in subsequent agreements by the relevant parties.
In the announcement, TCL Zhonghuan mentioned one impact of this transaction—this investment aligns with key assets required for the company's long-term strategy, helping to synergistically optimize the company's photovoltaic cell and module capacity, enrich its product and customer structure, and enhance its comprehensive competitiveness.
That is, TCL Zhonghuan has its eyes on Dawn Solar's cell and module production capacity.
According to information on Dawn Solar's official website, as early as 2023, the company had built 30GW of high-efficiency cell and 30GW of high-efficiency module capacity. By the end of 2025, the company's N-type high-efficiency cell and module capacity are projected to increase to 40GW each. This figure significantly exceeds TCL Zhonghuan's capacity—according to TCL Zhonghuan's interim report, as of the first half of 2025, the company's module capacity was 24GW.
Unlike other integrated solar leaders such as LONGi Green Energy Technology, Trina Solar, Jinko Solar, and JA Solar, TCL Zhonghuan, as a top company in the wafer segment, adheres to a moderately integrated capacity layout strategy and has maintained a relatively conservative pace in expanding its cell and module capacity. Consequently, TCL Zhonghuan has rarely been seen among the top ranks of global PV module shipments in recent years.
Dawn Solar, however, has charged into the global top ten as a dark horse. Information released by industry agency InfoLink Consulting shows that in the first half of 2025, Dawn Solar tied for seventh place globally in PV module shipments with Canadian Solar.
The reason TCL Zhonghuan's investment in Dawn Solar is attracting significant industry attention also lies in the particular significance of this deal within the current market environment.
The industry views TCL Zhonghuan's investment in Dawn Solar as a market-driven practice against the backdrop of "anti-involution" in the solar sector. During the industry's downturn over the past two years, executives from several leading solar companies have publicly stated that market-driven mergers and acquisitions are one of the important ways to reduce overcapacity in the PV industry.
In August 2024, another leading solar company, Tongwei Co., Ltd., announced it would make a cash capital increase in Runyang Co., Ltd. using its own or raised funds, while also acquiring its equity in cash, with a total planned transaction value not exceeding 5 billion yuan. This was called the "first case" of market-driven M&A under the "anti-involution" backdrop. However, in February 2025, Tongwei Co., Ltd. announced the termination of its investment in Runyang.
Some local governments have also explicitly fired the "first shot" targeting the integration of the photovoltaic industry chain this year. The General Office of the Yunnan Provincial Committee of the Communist Party of China and the General Office of the Yunnan Provincial People's Government recently issued the "Yunnan Province Action Plan for Accelerating the Construction of a Modern Industrial System and Promoting a Strong Industrial Province," proposing that in the silicon photovoltaic industry, support should be given to advantageous enterprises to carry out industrial chain integration and mergers and acquisitions, aiming to build a major domestic production base; by 2027, the photovoltaic capacity utilization rate should not be less than 70%.
In fact, as early as the fourth quarter of 2025, it was learned from industry sources that Dawn Solar was about to be "sold" to TCL Zhonghuan.
The equity structure shows that Dawn Solar's current major shareholders include Quzhou Zhidao Enterprise Management Partnership (Limited Partnership), Liu Yong, Suzhou Ruisuosi Environmental Technology Partnership (Limited Partnership), and Beijing Jingguoguan Equity Investment Fund (Limited Partnership), holding 17.4597%, 12.6048%, 8.1042%, and 5.9407% stakes, respectively.
It is important to note that in this "Cooperation Framework Letter of Intent," the main equity transferors are Quzhou Zhidao Enterprise Management Partnership (Limited Partnership) and Dawn Solar founder Liu Yong, who together hold approximately 30% of the shares. If TCL Zhonghuan acquires all these shares, it will take control of Dawn Solar.
"The signed 'Cooperation Framework Letter of Intent' is only a preliminary framework agreement; specific investment methods and terms are subject to the formal agreement signed by all parties," a TCL Zhonghuan representative responded on the evening of January 16 when asked whether the company would explicitly gain controlling stake.
It is worth mentioning that prior to this equity investment, Dawn Solar had also sought a listing on the A-share market. On December 29, 2023, the Shenzhen Stock Exchange's ChiNext board accepted Dawn Solar's listing application, but its IPO was terminated on August 16, 2024. Subsequently, in September of that year, rumors spread that Dawn Solar would be acquired by CATL. Although CATL Chairman Zeng Yuqiu later indirectly denied the rumors, industry insiders indicated that the two parties had indeed been in contact for discussions.
The specific transaction price for TCL Zhonghuan's investment in Dawn Solar has yet to be disclosed. However, given the challenging market conditions and operational difficulties faced by enterprises, TCL Zhonghuan also cautioned in its announcement: "Matters related to this transaction still carry significant uncertainty."
According to an earnings forecast, TCL Zhonghuan expects a net loss of 8.2 billion to 9.6 billion yuan for the full year 2025, which would represent a narrowing compared to the loss in 2024.
"This investment will help integrate the product technological capabilities of both parties, accelerate breakthroughs in new technologies and product capabilities such as BC cells, and enhance the company's leading advantage in the global photovoltaic industry," TCL Zhonghuan further stated.
This also implies that, if the investment proceeds smoothly, Dawn Solar's production capacity is expected to become a key support for TCL Zhonghuan's push into the BC cell business.
As of the market close on January 16, TCL Zhonghuan's share price was 8.84 yuan per share, giving it a latest market capitalization of 35.7 billion yuan.
Comments