Honolulu-based Hoku Scientific Inc. said yesterday it has hired an investment bank to explore the possible sale of the company. The company also announced that it will slow down construction of its polysilicon production plant in Pocatello, Idaho, in an effort to conserve cash as it explores financial options.

The announcements are a sign that the onetime Hawai'i high-technology star may not overcome its financial struggles in its current form.

Hoku said it retained Deutsche Bank Securities Inc. as a financial adviser to seek a possible sale of the parent company or its Hoku Materials subsidiary.

Hoku also said it reached an agreement with one of its customers, Suntech Power Holdings Co., that will allow Hoku to delay operational milestones at the Idaho plant. That amendment is contingent on a change of control at Hoku or Hoku Materials by April 2010.

The construction slowdown is expected to delay commercial polysilicon production from December to the middle of 2010. Suntech made $2 million in prepayments to Hoku in 2007 and has invested $20 million in the company. Suntech's willingness to push back near-term contract termination dates should help Hoku attract investment capital or a potential buyer, Hoku chairman and chief executive Dustin Shindo said in a news release.

So far, Hoku has secured about $243 million in customer prepayments and $41 million in equity to build its Idaho factory. But the company still needs at least $106 million to complete construction.

Hoku Scientific's market value is about $48 million, based on yesterday's stock price of $2.28 a share.

"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," Shindo said. "That being the case, we are seeking a strategic buyer for the company, while simultaneously seeking debt and equity financing alternatives."

Hoku — which means "star" in Hawaiian — was founded about nine years ago. The company originally was focused on developing the membrane, or engine, that drives fuel cells. In 2006, Hoku announced plans to build a $250 million plant in Idaho to manufacture polysilicon, one of the key materials in the production of photovoltaic, or solar, modules.

Today the company, which also installs photovoltaic power systems, employs about 20 people locally.