Hoku Scientific (HOKU.O) announced the end of an agreement to borrow up to $185 million from Merrill Lynch to fund construction of new polysilicon plant. The company also posted a larger-than-expect loss for the last quarter.
In December, Hoku and Merrill agreed to a funding deal for the company’s planned polysilicon plant in Pocatello, Idaho.
Instead of pursuing this financing, the company intends to raise $110 million through a stock and warrants offering, according to a company statement.
Hoku said it will need $112 million for engineering, procurement and construction to complete pilot production at the new plant in the fourth quarter of 2008.
The company expects the total cost of the plant, which is expected to begin pilot production in October, to come in at $390 million. Over the last several months, Hoku has been restructuring previously signed polysilicon agreements with companies including Sanyo, Suntech and Solarfun, which have committed $240 million towards plant costs. Hoku said it will contribute the remaining $40 million to construction costs from available cash.
For the company’s fourth, quarter ending March 31, 2009, Hoku reported a net loss of $2.1 million or $0.12 per share, compared to a net loss of $2.1 million a year ago.
Analysts had expected a loss of 5 cents a share, according to Reuters Estimates.
The company forecast first quarter revenues of $2.2 million to $2.7 million, higher than analysts’ expectations of $1.2 million.
The company said the future aggregate worth of it’s polysilicon supply contracts, most of which are for ten year periods, is $1.7 billion.
About Hoku Scientific, Inc.
Hoku Scientific is a diversified clean energy technologies company with three business units: Hoku Materials, Hoku Solar and Hoku Fuel Cells. Hoku Materials plans to manufacture, market and sell polysilicon for the solar market from its plant currently under construction in Pocatello, Idaho. Hoku Solar markets and installs turnkey photovoltaic systems and related services in Hawaii. Hoku Fuel Cells has developed proprietary fuel cell membranes and membrane electrode assemblies for stationary and automotive proton exchange membrane fuel cells.
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