Bloomberg News

Wacker Gains as LDK Bid for Sunways Spurs Consolidation Optimism

January 02, 2012

Jan. 2 (Bloomberg) -- Wacker Chemie AG, the second-biggest maker of solar-grade silicon, rose to the highest in almost three weeks in Frankfurt after LDK Solar Co.’s bid for panel- maker Sunways AG spurred the prospect of industry consolidation.

Wacker rose as much as 4.6 percent to 65 euros, the highest price since Dec. 13. LDK Solar Co. said on Dec. 31 that it intends to make a voluntary public takeover offer for Sunways, based in Konstanz, Germany.

Solar-panel makers in Germany have been struggling with falling demand in their home market, the world’s biggest in 2010, amid rising foreign competition. Chinese peers have increased production capacity even as international prices slumped, tipping Germany’s Solar Millennium AG and Solon SE into insolvency in December.

“The hope has arisen that consolidation of the solar industry has started,” said Erkan Aycicek, an analyst at Landesbank Baden-Wuerttemberg who has a “sell” rating on the stock. “The recent insolvencies also mean that overcapacity is being reduced.”

Wacker, based in Munich, was trading up 3.8 percent at 10:02 a.m. local time for a market value of 3.36 billion euros ($4.35 billion).

--Editor: Benedikt Kammel

To contact the reporter on this story: Sheenagh Matthews in Frankfurt at smatthews6@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net


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