Trony Solar gives up on IPO; another green casualty

Chinese thin-film solar module maker Trony Solar has canceled its filing for an initial public offering on the New York Stock Exchange after eight months. The move further solidifies the green sector’s miserable IPO streak.

Trony is one of a host of cleantech companies that jumped at the chance to go public after battery maker A123Systems’ blockbuster sale in September 2009. That company’s stock price skyrocketed nearly 50 percent on its first day, leading entrepreneurs to believe the IPO markets were finally thawing after more than a year.

But it looks like Trony and its cohort acted too soon. Not only have several green companies raised disappointing amounts in their public sales earlier this year — biofuel maker Codexis and Chinese solar cell maker Jinko Solar among them — but some have scrapped their ambitions altogether, most notably cylindrical solar cell maker Solyndra. Even A123, which spearheaded so many filings in late 2009, has seen its stock price steadily drop since.

Trony’s plan was to sell 19.5 million shares at between $9 and $11. The company says it withdrew its filing due to unfavorable market conditions. There’s no sign that these conditions will improve anytime soon. Many investors say that cleantech companies, by and large, are too risky and take too long to produce substantial returns.

But Trony’s failure is also indicative of the hardships being faced by the thin-film solar industry across the board. Despite today’s news that Sharp is joining forces with Enel Green Power and STMicroelectronics to churn out thin-film cells in the Mediterranean, thin-film solar makers are taking a hit (most recently exemplified by Applied Materials disbanding its SunFab thin-film equipment line and laying off 500 workers).

Thin-film cells are generally less efficient than their crystalline silicon peers. Their main saving grace — which motivated a lot of investment in the market two years ago — is that they use less silicon. Back when the material was expensive, this made thin-film a compelling proposition. But silicon prices have since dropped, allowing crystalline silicon panels and the companies who specialize in them, namely SunPower, to remain on top.

So even if the IPO markets warmed up to green, thin-film still has an uphill battle. Trony says it has suspended its public sale plans indefinitely, suggesting that it may take another shot sometime in the future, but it’s unclear when there will be another opportunity.

Based in Shenzhen, China, the company was backed by Intel Capital, which invested $20 million in October 2008, taking a 5.3 percent stake in the company. Trony was one of a number of thin-film companies that had luck that year. Competitor Nanosolar raised $300 million in March 2008, and Miasole raised $220 million in a fourth round of capital in July 2008.