Timminco stock hits new high on silicon contract

Thu Mar 27, 2008 12:37pm EDT
 
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TORONTO (Reuters) - Shares of Timminco Ltd surged 25 percent on Thursday after it announced a contract to supply solar grade silicon to Germany's Q-Cells AG, the world's largest solar cell manufacturer.

Timminco said its wholly owned subsidiary Becancour Silicon Inc has agreed to supply Q-Cells with 410 metric tons of silicon in 2008 and 3,000 metric tons the following year at fixed prices.

Negotiations are also under way for a further contract of 6,000 metric tons of silicon to be delivered each year from 2010 to 2013. The price for these deliveries will be negotiated based on market conditions, the company said.

Timminco's stock jumped C$5.12, or 24.5 percent, to a new high of C$26.01 at midday on the Toronto Stock Exchange. Shares in the specialty metals producer have soared since last year, when they were less than C$1, amid new contracts for its silicon unit.

Shares of Dutch company AMG Advanced Metallurgical Group NV also jumped 13.8 percent to 49.50 euros on the Amsterdam exchange. AMG has a 50.5 percent stake in Timminco.

"This contract represents a giant step for our solar grade silicon business," Becancour Silicon's chief executive, Rene Boisvert, said in a statement.

"Q-Cells is a leader in the photovoltaic industry and their endorsement of our material through this supply agreement is further evidence of the paradigm shift we are creating in the solar grade silicon market."

The price of the contract was not disclosed, but the deal makes Q-Cells Becancour's largest customer for solar grade silicon in 2009, Timminco said.

($1=$1.01 Canadian)

(Reporting by Leah Schnurr; editing by Rob Wilson)