If someone doesn’t come along and buy Hoku Scientific, Inc. the company might not survive to finish its polysilicon plant for solar panels in Pocatello.

The Hawaii-based company said Friday it needs at least $106 million to complete the plant despite $243 million in prepayments by customers.

“Given our current market capitalization, it is unlikely that we will be able to secure the capital we need without selling a majority of our stock or assets,” its chairman and CEO Dustin Shindo said in a press release. “That being the case, we are seeking a strategic buyer for the company, while simultaneously seeking debt and equity financing alternatives."

That’s tough news for Pocatello, which has been building a renewable energy industrial cluster around the plant that was expected to be completed later this year. Hoku plans to supply Sanyo, the world's fourth-largest manufacturer of solar panels, with polysilicon, the material used in microchips.

But its news Friday was about Suntech, the Chinese solar company that paid Hoku $2 million in prepayments in 2007, and made an equity investment of $20 million in Hoku.
It agreed to delay its deadlines for demonstration of the plant’s technology and shipping into 2010.

Hoku signed a $43 million tax increment financing deal with Pocatello and a deal with Idaho Power so it will receive guaranteed enough power to support 4,000 tons of polysilicon production annually at a fixed rate for four years.

Despite its problems, Suntech still has faith in Hoku.

"We believe in Hoku's ability to overcome its current challenges in raising capital," said Zhengrong Shi, Suntech's chairman and CEO. "They have done an admirable job with the construction of their plant, and we look forward to receiving our first shipment of polysilicon from Hoku."

So if you are interested in buying a company that has a lot of contracts and a partially built polysilicon plant you ought to give Shindo a call.