SunPower Signs Agreement to Acquire PowerLight Corporation
Acquisition Accelerates Growth and Product Innovation
SAN JOSE, Calif., Nov 15, 2006
Source: SunPower Corporation Press Release Nov 15, 2006
http://investors.sunpowercorp.com/releasedetail.cfm?ReleaseID=218726
SunPower Corporation (Nasdaq: SPWR), a Silicon Valley-based manufacturer of the world’s highest-efficiency, commercially available solar cells and solar panels, today announced it has signed a definitive agreement to acquire PowerLight Corp., a privately owned solar systems provider based in Berkeley, Calif. PowerLight is a leading global provider of large-scale solar power systems, having designed and deployed hundreds of large-scale solar systems with a total capacity of more than 100 megawatts over the past ten years. The PowerLight acquisition is expected to be immediately accretive to SunPower’s non-GAAP earnings.(1)
In North America, PowerLight is the market-leading installer of large, multi-hundred-kilowatt commercial rooftop and ground-mounted solar power plants in California, New Jersey, Nevada, and Hawaii. The company recently began providing complete residential solar system solutions to more than a dozen leading production homebuilders in California. In Germany, Spain, Portugal, Italy, and Korea, PowerLight designs, develops, operates and maintains solar electric power plants ranging from one megawatt to more than 10 megawatts, including two of the world’s largest solar electric power plants.
“Together, SunPower and PowerLight aim to accelerate the reduction of solar power costs to compete with retail electric rates without incentives,” said Tom Werner, SunPower CEO. “PowerLight is one of the premier system integrators worldwide and presents us with a downstream investment opportunity that will accelerate SunPower’s revenue growth while meeting our long-term financial model. By working closely with PowerLight over the past year as one of its key suppliers, we have gained great respect for their innovative products and the breadth and depth of their customer relationships. We intend to build on our strong market positions and duplicate our success in other emerging markets.”
“We are excited to join forces with the world’s leading solar technology company,” said Tom Dinwoodie, CEO of PowerLight. “As one of SunPower’s largest customers, we have experienced first-hand the powerful leverage that SunPower’s high-efficiency solar panels deliver to project economics. We see tremendous synergies between PowerLight’s patented system technologies and large-scale solar project expertise and SunPower’s high-efficiency solar cell technology and manufacturing discipline. Together we plan to develop the next generation of solar products and solutions that accelerate solar system cost reductions and radically simplify and improve the solar customer experience.”
“We believe that substantial growth opportunities lie ahead for our industry as solar system costs become competitive with retail electricity rates market by market over the next decade,” said Werner. “That vision will drive the strategy and objectives of our unified company.”
The total consideration for the acquisition is $265 million upfront plus a retention carve-out of $67.5 million vesting over 2 to 4 years. The aggregate consideration consists of approximately $130 million in cash and $202.5 million in stock and is expected to result in a tax-free merger for PowerLight’s shareholders. The acquisition is expected to accelerate SunPower’s revenue growth. SunPower intends to maintain its long-term financial model non-GAAP gross margin objective of 30%.
The transaction is subject to customary closing conditions, including approval by PowerLight’s shareholders and regulators. The parties anticipate closing the transaction in the first quarter of 2007. Following conclusion of this transaction, the combined company will have approximately 1,600 employees in ten sales offices and four manufacturing locations worldwide.