We are extremely excited about the acquisition of IES and the IES team’s ability to significantly enhance our ability to rapidly deliver new lighting products to the marketplace. The IES team is extraordinary at developing innovative LED lighting products that deliver strong returns on investment and superior lighting quality, and their tremendous talents are highly complementary to our EfficientLights business. Additionally, we are very pleased to announce our plan to exercise the option to purchase the led highbay light remaining one-third interest in EfficientLights. In addition to being highly accretive, our plan to complete this transaction is an acknowledgement of the strong success of the EfficientLights product, and our confidence in its future growth. We are energized by these investments, and looking forward to the benefits they provide as we continue to develop our LED lighting capabilities and business as a significant growth driver for our future.”
The IES transaction was completed on April 1, 2010, and the acquisition ownership and deal structure is similar to the structure the Company successfully utilized during the development of its EfficientLights business. Specifically, PowerSecure owns a two-thirds controlling interest in IES, which it acquired for cash proceeds of $4.4 million, and the IES management team owns the remaining one-third.
As a result, PowerSecure will include the financial results of IES on a consolidated basis in its financial statements, with adjustments to reduce PowerSecure’s net income for the minority interest portion of IES’s net income. Additionally, PowerSecure has the option to increase its ownership of IES to 100% by issuing PowerSecure common shares in exchange for the remaining one-third ownership interest in IES. The number of shares issued will be determined according to a formula based on PowerSecure’s Revenue and E.P.S. multiples, subject to a $10 million minimum value. The formula enables PowerSecure to acquire the remaining one-third interest on terms that are accretive to the Company’s E.P.S., while providing the IES management team with significant incentives for delivering profitable growth.
The IES transaction was completed on April 1, 2010, and the acquisition ownership and deal structure is similar to the structure the Company successfully utilized during the development of its EfficientLights business. Specifically, PowerSecure owns a two-thirds controlling interest in IES, which it acquired for cash proceeds of $4.4 million, and the IES management team owns the remaining one-third.
As a result, PowerSecure will include the financial results of IES on a consolidated basis in its financial statements, with adjustments to reduce PowerSecure’s net income for the minority interest portion of IES’s net income. Additionally, PowerSecure has the option to increase its ownership of IES to 100% by issuing PowerSecure common shares in exchange for the remaining one-third ownership interest in IES. The number of shares issued will be determined according to a formula based on PowerSecure’s Revenue and E.P.S. multiples, subject to a $10 million minimum value. The formula enables PowerSecure to acquire the remaining one-third interest on terms that are accretive to the Company’s E.P.S., while providing the IES management team with significant incentives for delivering profitable growth.
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