Memc, Suntech Reach Tentative Agreement on Solar Wafer Supply

Memc Electronic Materials Inc. of St. Peters, Mo., a manufacturer of wafers for the semiconductor and solar industries, and Beijing-based Suntech Power Holdings Ltd., a producer of solar cells and modules, announced that they have signed a letter of intent under which Memc will supply solar wafers to Suntech over a 10-year period, with pre-determined pricing and on a take-or-pay basis, beginning in the first quarter of 2007. Sales of the wafers over the 10-year period would generate between $5 billion and $6 billion in revenue for Memc, the companies said. In order for Memc to meet Suntech's supply requirements, Suntech will provide the company with an interest-free loan or security deposit which Memc will use to expand its manufacturing capacity. In addition, Memc will be able to buy up to a 4.9 percent equity stake in Suntech. The companies said they intend to reach a definitive agreement on the deal in August.