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More than a year after shelving a big plan to become a major solar panel maker, GE (s GE) said Tuesday it will sell its technology to what was once its big rival First Solar (s FSLR) instead.

First Solar has acquired GE’s thin film technology that uses an ultra-thin layer of cadmium-telluride to convert sunlight into electricity, the same type of technology that has set First Solar apart for the vast majority of its competitors. The sale gave GE 1.75 million shares of First Solar’s common stock and turned GE into one of the solar company’s top 10 shareholders.

The acquisition eliminates what could’ve been a fierce competitor for First Solar, which was in a race to outdo GE in improving the efficiency of its cells. First Solar’s most recent record cell announcement came in February, when it trumpeted an 18.7 percent cell made in a lab. GE has exceeded that since and created a 19.6 percent lab cell, said Jim Hughes, CEO of First Solar, during an earnings call Tuesday.

First Solar expects to incorporate some of GE’s technology into its own production within two years. GE’s previous plan to build a 400MW factory in Colorado is now officially dead.

GE also has agreed to buy First Solar’s panels and market them under the GE brand. GE is a long-time player in the power plant equipment business and supplies components from natural gas power plants to wind farms. It’s made equity investments in solar startups as well, from residential installer Sungevity to inverter developer SolarEdge Technologies. GE also finances solar power plant development and construction.

GE has signed a multi-year solar panel purchase agreement with First Solar, but Hughes declined to provide details. He did mention GE’s interest in “hybrid renewable applications,” which could include building solar power generation next to a natural gas power plant. Solar panels would produce electricity during the day and provide clean power to meet regulatory mandates while the natural gas power plant would run at night.

GE was working on entering the world of cadmium-telluride solar panel manufacturing just when global solar market began to feel the pain of a huge glut of solar panels. The oversupply crushed prices and caused dozens of manufacturers to file for bankruptcies. Many startups who aimed to bring new technologies to market either tanked or were scooped up cheaply.

China-based power producer, Hanergy, in particular, has acquired three thin film companies over the past year. Major solar manufacturers have suffered financial losses for many consecutive quarters, and a handful of them have only just begun to clear a profit again this year.

GE’s decision to back out of thin film manufacturing and stick with power plant equipment sales and construction business is a sound one. Many solar panel makers have branched out into project development in order to survive.

The majority of the world’s solar panels are made with silicon cells. First Solar made a name for itself for developing an efficient manufacturing process to make cadmium-telluride solar panels. That has made its panels cheaper even if they aren’t as efficient at converting sunlight into electricity.

But the plummeting prices for silicon solar panels in recent years have eroded First Solar’s cost advantage. As a result, the company has put more focus on research and development work to increase the efficiency of its cadmium-telluride technology. It also bought a silicon solar cell startup, TetraSun, to target customers and projects that demand higher-efficiency products. First Solar plans to start shipping TetraSun’s silicon cells in the second half of 2014.