BEIJING, Aug 14 (Reuters) - Solar company Tongwei

is planning to buy a controlling stake in competitor

Runergy for about 5 billion yuan ($697.78 million) in a move

that would allow the Chinese company to gain presence in the

United States.

The company is looking to acquire at least 51% of Runergy

via a capital boost and share purchase, Tongwei said in a filing

with the Shanghai stock exchange late on Tuesday.

Runergy, which is building a 5 gigawatt (GW) solar module

plant in Huntsville, Alabama, is among Chinese solar firms

setting up shop in the U.S. to take advantage of clean energy

manufacturing subsidies under the 2022 Inflation Reduction Act.

Chinese companies are largely locked out of exporting from

China to the United States, a higher-margin market, because of

tariff barriers.

Analysts have said that they expect consolidation in China's

solar manufacturing, which has faced growing overcapacity,

mounting losses and calls by regulators to limit investment in

new production.

Runergy has 57 GW of solar cell and 13 GW of module

production capacity, according to the filing with the stock

exchange. Tongwei was the fifth-largest Chinese shipper of solar

modules during the January-June period, InfoLink Consulting

said.

Tongwei reported a net loss between 2.2 billion yuan and 2.5

billion yuan in the second quarter, according to the company's

preview of its first-half results.