Fun In the Sun: Good Energy Ups Stake in SolarFun

A couple weeks ago, following Trina Solar’s results, we said that the photovoltaics manufacturing industry needed consolidation. Lo and behold, Good Energy, a shareholder in Trina Solar, has upped its stake in Chinese PV manufacturer SolarFun (SOLF) from 6% to 35%. Could a merger between Trina and SolarFun be somewhere in the future?

Good Energy, a renewable energy investment holding company, now has a portfolio with a market cap of over 4 billion euros. Good Energy has built up an impressive portfolio spanning the entire value chain. We’re guessing that the company’s CEO, Richard Kauffman, former head of global financing at Goldman, has big plans for the company’s dozen solar investments.

The stock of SolarFun jumped 25% following the news. Investors have given it the cold shoulder till recently. It went public in December 2006 and the stock slide below $10 per share from an IPO price of $12.50. Since November 29th, when the company announced better-than-expected Q3 revenue and upped its 2007 guidance, it’s up over 130% to today at about $26.25 a share.

The stock purchase also reflects a notable transfer of power from SolarFun’s founder and CEO, Yonghua Lu, to his new investors. Good Energy, a COFRA subsidiary, purchased 50% of Lu’s shares, and now control more than twice as much of the company as he does. That could be a step towards


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