Langley to acquire Active Power
Langley Holdings PLC has entered into an Agreement to acquire the business and assets of Texas based flywheel energy storage producer, Active Power (NASDAQ: ACPW)
Active Power, a manufacturer of flywheel energy storage products and modular infrastructure solutions (MIS), today announced that it has signed an Asset Purchase Agreement (APA) with Langley Holdings PLC (Langley). Under the terms of the APA, Langley will acquire substantially all assets and operations of Active Power - including the Active Power name - through their Piller USA Inc. subsidiary, for a nominal purchase price, plus the assumption of all debt, liabilities, customer, employee and purchase commitments going forward. Closing is subject to customary conditions and to the approval of the stockholders of Active Power. Closing is expected to occur in the fourth quarter of 2016.
Langley is a diverse, privately owned engineering and industrial group based in the United Kingdom with principal operating divisions located in Germany and France and more than 80 subsidiaries worldwide. The group was founded by the current Chairman, Tony Langley, in 1975 and had revenues of $1.1 billion in 2015. In 2004, Langley acquired Piller Group GmbH, a world leader in power protection technology and rotary UPS systems. Langley’s mid-year 2016 financial statements can be viewed here.
“The acquisition of the assets of Active Power is consistent with Langley’s strategy and business model,” said Board member, Bernard J. Langley. “The addition of Active Power’s differentiated flywheel UPS technology to Piller’s power protection portfolio will further strengthen its position in the market, creating more compelling alternatives to traditional UPS offerings for mission critical applications.....we plan to maintain Active Power’s manufacturing operations in Austin, further expanding our operating footprint in the United States with this acquisition.”
“We are delighted to enter into this agreement with Langley as we believe it equitably addresses the present circumstances facing Active Power with an optimized outcome.” said Mark A. Ascolese, the Company’s President and CEO. “The current capital market environment is very challenging, making it difficult to raise capital through traditional equity financing to support our current operations. Langley Holdings is a proven long-term investor and this deal enables us to avoid a costly liquidation process or further funding operations’ given our diminished cash balance. We believe it is the best alternative available for the benefit of our stockholders, customers, employees and vendors.”
After the Closing, under the APA the Company will transition its business model to monetize non-core intellectual property assets not purchased by Langley, and to acquire profitable businesses. The Company is in active negotiations with several parties to raise additional capital to support this business strategy.
“The Agreement with Langley is an important step towards positioning the Company for the future,” Ascolese continued. “Our business plan is to leverage the assets not sold to Langley and to acquire and operate businesses that will generate profit and positive cash flows, thereby creating enterprise value and utilizing our net operating loss carry forward and other tax benefits. We believe this strategy is in the best interest of all our stakeholders and will result in higher long term stockholder value than the other alternatives available to us.”
The Net Operating Loss Shareholder Rights Agreement announced on June 15th 2016 was designed to preserve Active Power Inc.’s substantial tax assets.
About Active Power
Active Power (NASDAQ: ACPW) designs and manufactures flywheel uninterruptible power supply (UPS) systems, modular infrastructure solutions (MIS), and energy storage products for mission critical and renewable applications worldwide. The company’s products deliver 40 percent lower total cost of ownership, are proven 12 times less likely to fail and produce nine times less carbon emissions that conventional UPS products. With nearly 5,000 flywheels in systems deployed worldwide to date, Active Power has saved customers an estimated $225 million in electricity and battery replacement costs, reduced 850,000 metric tons of carbon emissions and prevented 16,000 metric tons of lead from being mined, smelted and deployed. Customers are served via Austin and three regional operations centers located in the United Kingdom, Germany and China, that support the deployment of systems in more than 50 countries. For more information, visit www.activepower.com.
Active Power and Driven by Motion are registered trademarks of Active Power, Inc. The Active Power logo is a trademark of Active Power, Inc.
About Piller
Piller Power Systems GmbH is a world leader in power protection technology. The company builds electrical systems for mission-critical applications world-wide. Clients include many of the world's central and commercial banks, stock exchanges and other financial institutions, as well as broadcasters, telecommunications networks, airports, government departments and co-location operators. Founded by the German engineer Anton Piller in 1909, more than a century on Piller is still headquartered and produces in Osterode and nearby Bilshausen, although today the company has subsidiaries across Europe, the Americas, Asia and Australia and employs over 800 people world-wide. Piller is a division of the privately owned British engineering and industrial group, Langley Holdings PLC. www.piller.com
About Langley Holdings PLC
Langley Holdings plc is a diverse, privately owned engineering and industrial group based in the United Kingdom with principal operating divisions located in Germany and France and more than 80 subsidiaries worldwide. The group's companies produce equipment ranging from electrical systems for data centers, machinery for cement and steel plants to food packaging lines, automotive welding equipment and printing presses. The group was founded in 1975 by the current chairman, Tony Langley, and currently employs around 4,300 people worldwide.