Skyworth Group (HKG:0751) said it planned to spin off its solar business and distribute shares to its minority shareholders as part of a broader restructuring, according to a Hong Kong bourse filing Tuesday.

Skyworth shares surged 30% on Wednesday.

The firm currently owns 70% of Skyworth Photovoltaic and plans to spin off the business by way of introduction to the Hong Kong stock exchange. Skyworth shareholders would be entitled to receive 0.37 of a Skyworth Photovoltaic stock for every share held in the company.

Skyworth Group then plans to delist the company and take it private by offering to buy shares from minority shareholders for either HK$4.03 per share in cash, one new share in the delisted company, or a combination of both.

The firm's controlling shareholder, which owns 66.46% of the business, will be excluded from the buyback but will receive shares in Skyworth Photovoltaic in proportion to its holdings.

The cash plus Skyworth Photovoltaic stock combination will yield about HK$10.16 per Skyworth share, according to Skyworth Group.

The transactions are interdependent on each other and cannot proceed if either one fails. The firm will call a meeting of shareholders to seek approval for the transactions.

The firm said it was restructuring the business as its traditional TV and appliance arm was slow-growing while the solar business had become the main driver for profit and growth.

Skyworth added that its current structure undervalued the solar business and a restructuring was the appropriate way forward for Skyworth Photovoltaic to access more efficient financing resources and position itself for independent growth.