Hanwha Solutions raises $84.1m from US venture fund sale to fund self-rescue plan

Hanwha Solutions has raised approximately 125.5 billion won ($84.1 million) by selling a US venture investment fund, accelerating its self-rescue measures tied to a rights offering.

Hanwha Solutions said Thursday it had sold a venture investment fund — originally established to identify innovative US companies — for $84.3 million, or about 125.5 billion won. The proceeds will supplement debt repayment funds needed following a reduction in the size of the rights offering and speed up improvements to its capital structure.

The company had invested in the fund since 2022 through a subsidiary to track emerging technology trends and secure early business cooperation opportunities in the United States. Given the fund's nature as a long-term vehicle for discovering and backing innovative companies, it had not previously been considered for sale. Taking into account a range of market views on the rights offering, however, the company decided to sell the venture fund, judging that the impact on medium- to long-term profitability would be limited and that early liquidation was feasible.

Hanwha Solutions earlier announced it had issued 300 billion won in redeemable convertible preferred shares through its Qcells division's US engineering, procurement and construction subsidiary. The proceeds will cover the funding shortfall created by the reduced rights offering and improve the company's capital structure. A Hanwha Solutions official said the company would "proceed as planned with future growth investment and financial soundness enhancement by pursuing the rights offering and self-rescue measures in parallel."

Meanwhile, Korea Ratings and NICE Credit Rating both maintained Hanwha Solutions' credit rating and outlook at AA- (Negative) in their regular reviews last month. This stands in contrast to some other petrochemical companies, whose ratings or outlooks were downgraded amid growing global uncertainty.

Korea Ratings projected a recovery in Hanwha Solutions' renewable energy earnings over the short to medium term, citing three factors: vertical integration synergies from the completion of the solar factory in Cartersville, the company's strong market position in the residential energy business, and its efforts to expand long-term EPC contracts.

Lee Jae-bin, chief financial officer of Hanwha Solutions, said the company plans to proceed without disruption with its future growth investment and capital structure improvement plans once the rights offering is complete. "We have established a foundation for vertical integration in the US solar market with the completion of the Cartersville factory, and we expect a stable earnings trajectory to continue in the renewable energy segment," he said.