Minority shareholders continue pushback on Hanwha’s takeover bid on REC Silicon

A minority investor in REC Silicon has filed a petition in U.S. courts for information related to Hanwha Group’s involvement in REC Silicon’s operations. The petition claims that Hanwha Group, currently REC Silicon’s largest shareholder, purposely tanked REC Silicon’s polysilicon manufacturing efforts in Moses Lake, Washington, in order to seize complete ownership of the company.

The Moses Lake production plant

REC Silicon, a Norwegian company, has a long history of polysilicon production in Moses Lake. After being one of the top polysilicon producers in the world, a series of market events forced REC Silicon to close its Washington plant in 2018. In 2022, Korean conglomerate Hanwha Group became REC Silicon’s largest shareholder, providing cash to restart production and a secure supply contract to the Hanwha Qcells solar panel manufacturing operation in Georgia. REC Silicon was in the process of restarting polysilicon production at Moses Lake when it abruptly ceased all operations in late 2024.

REC Silicon stated that it was unable to continue operations in Moses Lake after it received an “unsuccessful qualification test” by its “customer.” At the time, Hanwha was considered to be REC Silicon’s only customer, as it had an exclusive 10-year supply deal.

In April 2025, Hanwha sent an $88.6 million all-cash offer to acquire all outstanding shares of REC Silicon and make the company private. REC Silicon’s board of directors, largely represented by Hanwha seats, “unanimously recommended” that shareholders accept Hanwha’s deal. Norwegian minority shareholders very quickly voiced their opposition to the deal, writing a letter to “stop the steal.”

Water Street Capital, an investment firm representing minority shareholders, filed the petition in the U.S. District Court of the Washington Eastern District. It is requesting information from REC Silicon in order to bring an appropriate civil lawsuit in Norwegian courts.

Water Street Capital claims that Hanwha made misleading statements to REC Silicon’s other shareholders by “failing to disclose that it has sabotaged the operations at the Moses Lake facility, terminated the plant’s experienced employees, continuously changed production procedures and intentionally caused REC Silicon to fail a crucial test of its product’s quality as a pretext to terminate the 10-year supply contract.” Once REC Silicon’s stock price collapsed after the plant shutdown in December 2024, Water Street Capital says that Hanwha was able to commence a takeover bid for “pennies on the dollar.”

Meanwhile, Hanwha sent a letter to REC Silicon’s Board of Directors on June 24 stating that if the voluntary offer was not accepted, “Hanwha may no longer be able to provide additional funding to REC Silicon.” It appears that REC Silicon does not have sufficient cash available to continue operations for the year. Shareholders were scheduled to vote on the bid yesterday, but that was extended to July 8 and could possibly be extended up until Aug. 1.

Water Street Capital has requested that its petition for discovery be expedited for the upcoming shareholder vote, but nothing has been decided yet.

At REC Silicon’s annual general meeting on June 24, shareholders voted in a new board of directors that includes Norwegian representatives. The Hanwha-nominated board was voted out. Minority shareholders also successfully requested an internal investigation, which is now ongoing.