SHENYANG, China, Aug. 12 /PRNewswire-Asia/ -- A-Power Energy Generation Systems Ltd. (Nasdaq: APWR) (“A-Power” or “the Company”), a leading provider of distributed power generation (“DG”) systems in China and a fast-growing manufacturer of wind turbines, today announced that it has signed a memorandum of understanding (“MOU”) to acquire 100% of EVATECH Co., Ltd. (“EVATECH”) of Kyoto, Japan, a 22-year-old designer and manufacturer of industrial equipment for LCDs (liquid crystal displays) and PDPs (plasma display panels). The all-cash transaction is initially valued at $50 million and is expected to be primarily funded through a combination of government subsidies and loans. Government subsidies are expected to amount to 40% to 45% of the total purchase price, and auditors in Japan are currently preparing a fairness opinion for the transaction. A-Power expects to sign a definitive purchase agreement with EVATECH by September and close the transaction by the end of November 2009.
“We are truly excited about the potential of adding EVATECH’s advanced thin-film solar technology to our reservoir of expertise in the design, manufacturing and installation of clean energy systems,” said Mr. Jinxiang Lu, A-Power’s Chairman and CEO. “The timing is fortuitous for alternative energy developers in China. Our central government just last month announced the ‘Golden Sun’ project to subsidize up to 70% of the costs of building solar farms with a total capacity of at least 500MW by 2012, versus the country’s current capacity of 80MW.”
Mr. Lu continued, “EVATECH has more than 20 years of experience in developing thin-film products, and since 2006, it has begun producing production lines for thin-film PV batteries, with dedicated R&D centers in Japan. EVATECH’s world-leading PV technologies include the ‘atmospheric-pressure chemical vapor deposition’ (AP-CVD) manufacturing technique and the ‘transparent conducting oxide’ (TCO) glass, which could significantly reduce thin-film battery production costs and enhance its photoelectric conversion rate, which with EVATECH’s current technology, already stands at 8%. During EVATECH’s restructuring process in the courts of Japan, it was seeking a strategic buyer with complementary product offerings. A-Power’s initial plan is to keep EVATECH’s two current R&D centers in Japan while moving the production of thin-film PV batteries and TCO glass coating to China, thus further reducing production costs by exploiting China’s low-cost manufacturing advantage.”
Based in Kyoto, EVATECH currently has 85 employees and has branch offices in Tokyo, Shanghai and Taiwan. Its main manufacturing facility and its thin-film photovoltaic R&D center are located in Kyoto. It sells to customers in about 10 countries outside Japan, 46 of which are in China, which is EVATECH’s largest overseas market. Due to certain financial difficulties with the operation of its business, EVATECH is currently undergoing a rehabilitation process in the courts of Japan related to its corporate and debt restructuring.
For more information, please visit EVATECH’s English-language Website at http://www.evatech.co.jp/index_en.htm
About A-Power
A-Power Energy Generation Systems Ltd. (“A-Power”), through its China-based operating subsidiaries, is the largest provider of distributed power generation systems in China, focusing on energy-efficient and environmentally friendly projects of 25MW to 400MW. In 2008, A-Power entered the wind energy market and has built China’s largest wind turbine manufacturing facility, located in Shenyang, Liaoning Province, with technologies licensed from German FUHRLANDER AG and Denmark-based Norwin, and a total annual production capacity of 1,125MW. In March 2009, A-Power entered into an agreement to establish a Joint Venture partnership with GE Drivetrain Technologies to produce wind turbine gearboxes in Shenyang. A-Power also has strategic relationships with Tsinghua University in Beijing and the China Academy of Sciences in Guangzhou to develop and commercialize other renewable energy technologies. For more information, please visit http://www.apowerenergy.com .
Safe Harbor Statement
This press release may contain forward-looking statements. Any such statement is made within the ‘safe harbor’ provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," and other similar statements. Statements that are not historical facts, including statements relating to anticipated future earnings, margins, and other operating results, future growth, construction plans and anticipated capacities, production schedules and entry into expanded markets are forward-looking statements. Such forward-looking statements, based upon the current beliefs and expectations of our management, are subject to risks and uncertainties, which could cause actual results to differ materially from the forward-looking statements, including but not limited to, the risk that: We may not be able to sign definitive agreements with our acquisition target, or complete the acquisition at all; our acquisition target is undergoing restructuring in local courts, which may interfere with our ability to acquire the target company; our acquisition target’s restructuring process in local courts relates to financial difficulties it experienced in the operation of its business, and it may continue to experience financial difficulties after we acquire it; we may not be able to obtain government subsidies or debt financing related to the acquisition of the target company; we have outstanding convertible notes which have certain restrictions against our ability to incur further debt, which may inhibit our ability to finance our acquisition of the target, or potentially result in a breach of our covenants under our convertible notes; our technicians may have difficulty adapting to new technology; systems that we develop and install may contain design or manufacturing defects, which could result in reduced demand for our services and customer claims and uninsured liabilities; we expect to rely increasingly on our proprietary products and systems and on technology developed by our licensors, and if we or our licensors become involved in an intellectual property dispute, we may be forced to spend a significant amount of time and financial resources to resolve such intellectual property dispute, diverting time and resources away from our business and operations as well as other relevant risks detailed in our filings with the Securities and Exchange Commission, including those set forth in our annual report filed on Form 20-F for the fiscal year ended December 31, 2008. The information set forth herein should be read in light of such risks. We assume no obligation to update the information contained in this press release, except as required under applicable law.
For more information, please contact:
Mr. John S. Lin
Chief Operating Officer
A-Power Energy Generation Systems
Email: john@apowerenergy.com
Mr. Valentine Ding / Mr. Dixon Chen
Investor Relations
Grayling
Tel: +1-646-284-9412
Email: valentine.ding@us.grayling.com
dixon.chen@us.grayling.com