Hyundai Heavy Industries Co., the world’s largest shipbuilder, said  it plans to spend 41.7 billion won ($43.9 million) in cash to set up a polysilicon-producing joint venture with KCC Corp., a Korean chemicals producer.
Polysilicon is an essential raw material in the production of solar cells for panels that convert sunlight into electricity.
According to Korea.net, the two companies agreed to establish the joint venture with paid-in capital of 85 billion won, with Hyundai Heavy holding a 49 percent stake in the company, Hyundai Heavy said in a regulatory filing.
In early February, KCC said it will spend 320 billion won on the joint venture between February and July 2010, adding if completed, the company will have an annual production capacity of 3,000 tons of polysilicon.
The chemicals maker on Feb. 13 signed a deal with U.S.-based Solar Power Industries, Inc. to supply 92.5 billion won worth of polysilicons by December 2013.
Hyundai Heavy is building its second factory to manufacture solar modules and solar cells. In 2006, the shipbuilder set up a plant, which produces 150,000 solar modules annually.