What happened 

Shares of solar manufacturer Hanwha Q Cells (NASDAQ:HQCL) jumped as much as 19.3% in trading Tuesday after a buyout agreement was announced. The gain settled at about 16.7% at 10:45 a.m. EDT. 

So what

Hanwha Q Cells is already controlled by Hanwha Chemical Corporation, but now the conglomerate wants to own the whole company. Through a subsidiary called Hanwha Solar Holdings, a buyout valuing Hanwha Q Cells at $825 million has been offered and agreed to. The deal, if completed, will pay shareholders $9.90 per share, a slight premium to where shares were trading early Tuesday. 

Solar farm with mountains in the background.

Image source: Getty Images.

Given Hanwha Chemical's size, this isn't as risky a buyout offer as some in the solar industry that have included management and a lot of leverage. That's why shares have jumped to near the buyout price. 

Now what

This buyout agreement continues a long trend of solar companies going private. Trina Solar, JA Solar, and Canadian Solar have gone private or have agreed to a deal. For investors, I don't see much upside in holding on to shares given the small premium the buyout might give when completed early in 2019. I would take the risk that the deal falls through off the table, and cash in on this big pop today.  

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.