(Yicai) Jan. 2 -- China’s Haitian Water Group, which is branching into the solar sector, will pay German tech giant Heraeus CNY502 million (USD68.8 million) in cash for its solar silver paste operations and factories in China and Singapore, which produce a key raw material that forms the metal electrodes in photovoltaic cells.

Haitian Water, one of the leading private tap-water suppliers and waste-water treatment service providers in China’s southwest regions, is buying all of Heraeus’ solar silver paste assets, including 100 percent equity in its Shanghai and Singapore subsidiaries, the Chengdu-based firm said in an asset acquisition report released on Dec. 31. Haitian Water will also settle all the Shanghai unit’s debts owed to its German parent.

The acquisition, which is expected to close in the first half this year, will encompass tangible and intangible assets such as management teams, patent technologies, R&D platforms, customer resources, production lines, and supply chain systems, the report said.

Heraeus has been one of the world’s leading suppliers of PV silver paste, which is a conductive paste that boosts the photoelectric conversion efficiency of solar cells and allows them to adapt to a broad temperature range, for the past decade.

However, with the entry of new players, the competitive landscape of the industry has changed, leading Heraeus to reconsider the strategic direction of its PV business, Ai Zhouping, president of the company’s China arm, told Yicai.

The assets being bought by Haitian Water have been operating at a loss since 2023. In the first half last year, the companies posted a net loss of EUR6.8 million (USD7.12 million) on revenue of EUR125 million (USD129.6 million), according to the latest data.

Selling off its solar assets does not mean Heraeus is pulling out of China, Ai said. The Hanau-based company will continue to invest in China, particularly in strategically aligned areas, further leveraging its expertise as a materials specialist to maintain its competitive advantage.

Haitian Water’s share price [SHA:603759] was trading down 1.6 percent at CNY8.78 (USD1.20) at 1 p.m. today. However, the stock has risen steadily in the last three and a half months and hit its highest level since February 2023 on Dec. 31.

Editor: Kim Taylor