Hanwha Solutions is set to borrow 2 trillion won (approximately $1.45 billion) both domestically and internationally to counter worsening cash flow as it faces substantial net losses this year. The investment banking sector disclosed on July 26 that the company will secure the funds through corporate bonds and loans in July and August.
Hanwha Q CELLS Georgia Inc., a subsidiary of Hanwha Solutions, secured $700 million (approximately 972.7 billion won) via a green syndicated loan from European banks including Natixis, Santander, and Société Générale. A green syndicated loan is designated for eco-friendly investments. Additionally, Hanwha Solutions’ German subsidiary, Q Energy Solutions SE, plans to issue green bonds worth 200 million Swiss francs (approximately 311.2 billion won or $226.73 million) next month.
Hanwha Solutions will also issue 800 billion won worth of private perpetual bonds, with a 30-year maturity and a call option allowing early redemption after three years. If not redeemed, the interest rate will increase by 1.3 percentage points annually. Negotiations for these bonds are underway, with interest rates expected to range between 5% and 6% per year.
This extensive fundraising effort is a response to Hanwha Solutions’ deteriorating cash flow, which has resulted in a cumulative net loss of 777.7 billion won in the first half of the year. The company’s financial woes stem from significant losses in its renewable energy and chemical businesses. A steep decline in solar module prices led to an operating loss of 277.1 billion won in the renewable energy sector, while the chemical sector saw an operating loss of 36.1 billion won.
Despite these losses, Hanwha Q CELLS Georgia is investing 3.2 trillion won to build an 8.4GW solar module production base in Georgia, USA. By the end of June, net debt surged to 10.40 trillion won, a 43.1% increase from last year, and the debt ratio rose to 185%. The issuance of perpetual bonds is a strategic move to stabilize the company’s financial structure.
