“American Factory” Owner Fuyao Glass To Raise $550 Mln, Eyes Solar Market
China-based Fuyao Glass Industry Group, whose U.S. plant was the subject of the Oscar-winning documentary “American Factory” in 2020, plans to raise to HK$4.3 billion, or $550 million, in a stock sale amid improvement in its business this year, according to a Hong Kong Stock Exchange filing on Sunday.
The glass supplier, whose auto industry customers include Toyota, Volkswagen, General Motors, Ford and Hyundai, plans to sell 101.1 million shares at HK$42.64, representing a fully diluted 3.9% stake. Fuyao’s shares trade in Hong Kong and Shanghai.
Fuyao expects that China’s automobile industry “will recover and rebound in 2021” compared with pandemic-hit 2020, the company said in the statement. “By using the funds raised from the placing in its working capital, debt repayment, research and development projects, photovoltaic glass market expansion and general corporate uses, the company may further expand its business and optimize its capital structure,” the statement said. Fuyao, which generates nearly half of its sales from outside of China, also aims to “attract more international reputable investors with strategic value and improve (the) equity structure of the company.”
Revenue last year fell by 5.7% to 19.9 billion yuan, or $3 billion; net profit declined by 10.3% to 2.6 billion yuan. Operations recovered in the first quarter, however: operating revenue rose by 37% to 5.7 billion yuan and net profit increased by 86% to 855 million yuan.
China is the world’s No. 1 automobile market; auto sales in the country rose by 75% in the first quarter of 2021 to 6.5 million units. China also makes approximately 80% of the world’s solar panels; the country’s Xinyi Glass and First Glass Group are two of the world’s largest suppliers of photovoltaic glass. Fuyao, founded in 1987, said about 10% of funds raised from its new stock sale would be used “to expand the photovoltaic glass market and general corporate uses.”
Fuyao’s U.S. factory is located in Moraine, Ohio. Besides China and the U.S., Fuyao has manufacturing sites in 10 other countries including Russia, Germany, Japan and South Korea; it employs more than 27,000 worldwide, according to the company’s website.
Fuyao’s chairman Cho Tak Wong has a fortune worth $4.3 billion today on the Forbes Real-Time Billionaires List. His son Tso Fai is vice chairman. Xinyi Solar’s main shareholder Lee Yin Yee has a fortune worth $4.9 billion and Flat Glass Chairman Ruan Lianghong’s is worth $4.9 billion.
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