Tongwei plans to acquire polysilicon competitor Qinghai Lihao

Shanghai-listed polysilicon producer Tongwei says it intends to acquire 100% of Qinghai Lihao through a share-and-cash transaction, as consolidation in China’s polysilicon sector increasingly shifts toward mergers and acquisitions.

February 27, 2026 Uma Gupta

Tongwei's factory in China

Image: Tongwei

Tongwei said it plans to acquire 100% of Chinese competitor Qinghai Lihao through a transaction combining share issuance and cash, alongside a planned supporting fundraise, according to a trading suspension notice dated Feb. 25.

Tongwei said the deal remains at a preliminary stage. It has signed an intention agreement with the proposed sellers – Duan Yong and two limited partnerships, Hainan Zhuoyue Enterprise Management Partnership and Hainan Haoyue Enterprise Management Partnership – and said the final parties and terms will be disclosed in a subsequent transaction plan or report. The company added that the transaction is not expected to result in a change of control, does not constitute an affiliated transaction and, based on its initial assessment, is not expected to qualify as a major asset restructuring.

To prevent abnormal share price fluctuations while details remain uncertain, Tongwei suspended trading of its A-shares and related convertible bonds from market open on Feb. 25. The suspension is expected to last no more than 10 trading days.

Qinghai Lihao is a privately held joint-stock company registered in 2021 in Xining, Qinghai province. Its business scope includes electronic materials and related manufacturing and trading activities.

Industry reports describe Lihao as a rapidly scaling polysilicon producer leveraging Qinghai’s renewable power resources. Public reporting on its buildout indicates that a first-phase 50,000 metric ton polysilicon project reached commissioning in 2022, with longer-term capacity ambitions reported to be significantly higher, although Tongwei’s suspension notice did not disclose capacity figures or a purchase price.

The move follows the decision by China’s antitrust regulator in early January to halt an industry-led effort to curb polysilicon capacity and coordinate pricing. The plan involved six major producers – Tongwei, GCL, Daqo, Xinte, East Hope and Asia Silicon – and envisaged raising about CNY 50 billion ($7 billion) to acquire and idle roughly one-third of the country’s polysilicon production capacity. The six companies together account for nearly 2.5 million metric tons of capacity, while the remainder of the industry represents about 700,000 metric tons.

Against this backdrop, Tongwei’s proposed acquisition of Lihao points to a market-driven consolidation path through mergers and acquisitions rather than coordinated capacity management. If completed, the transaction would place a significant portfolio of relatively new Qinghai polysilicon assets under a larger incumbent, potentially accelerating capacity concentration among fewer balance sheets. The effect on effective supply, however, will depend on how the combined entity manages utilization rates, product mix and expansion plans.

Tongwei said further details – including valuation, definitive agreements, audit and appraisal results and regulatory approvals – are still pending, and it cautioned investors about execution risks.

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