Active Power Enters into Asset Purchase Agreement with Langley Holdings PLC
Transaction Unites Flywheel UPS Specialist with World’s Largest Rotary UPS Manufacturer
AUSTIN, Texas (Sept. 30, 2016) – Active Power (NASDAQ: ACPW) (“Company”), 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 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.”
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 applications worldwide from its headquarters and manufacturing plant in Austin, Texas. The company was founded in 1996 and became public in 2001.
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 Piller Power Systems Inc (Piller). The Active Power logo is a trademark of Piller Power Systems Inc (Piller).
About Langley Holdings
Langley Holdings plc is a diverse, privately owned engineering and industrial group based in the UK 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 centres, 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.