(Yicai Global) Dec. 7 -- Shares in Titan Wind Energy surged as much as 7.3 percent today after the Chinese renewable energy firm said it is paying CNY3 billion (USD428 million) in cash to take over wind power equipment supplier Jiangsu Strongwind Marine Equipment to improve its positioning in the offshore wind power gear sector and boost competitiveness.

Titan Wind’s stock price [SHE:002531] closed up 0.8 percent at CNY15.04 (USD2.15) today after investors cashed in. Earlier in the day it hit CNY16, the highest in three and a half months.

The acquisition, once completed, will consolidate Titan Wind’s position as a leading supplier of offshore wind power gear in the coastal areas off southeastern Jiangsu province, the Shanghai-based company said.

Titan Wind plans to merge its own single pipe pile plant for offshore wind energy with that of a subsidiary of Strongwind, giving the firm an annual capacity of 600,000 tons, said Titan Wind, which is both a wind power station operator and leading wind tower and turbine blade manufacturer.

Strongwind’s other unit makes wind power jackets and step-up substations for offshore wind power projects both at home and in East Asia, it added.

The selling price was determined by both parties based on the book value of Strongwind’s assets, its orders in hand, its customer resources, its expectations for future profitability and the potential value of intellectual property rights on technologies that it is developing, Titan Wind said.

Titan Wind is applying to list on Switzerland’s Six Swiss Exchange to raise funds to build more wind power equipment plants both in China and Germany, the company said in September. In September 2019, Titan Wind bought an an offshore wind power pile foundation plant in Cuxhaven, Germany for EUR22 million (USD23 million).

China’s offshore wind power equipment market has been growing at an annual compound rate of 99.1 percent since 2017, thanks to a big jump in installations of offshore wind power projects, and reached CNY22 billion (USD3.1 billion) last year, the company said, citing the latest statistics. The global offshore wind turbine market has been expanding at a yearly compound rate of 65.1 percent since 2017, hitting USD5.2 billion last year.

Editor: Kim Taylor