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Accretive Acquisition Expected to Add Approximately US$25M in Revenue and Launch Light-Duty Automotive Strategy for Westport's Juniper Engines
published: July 2, 2010
VANCOUVER, BC – Westport Innovations Inc. (TSX:WPT/ NASDAQ:WPRT), a global leader in alternative fuel, low-emissions transportation technologies, today announced that it has acquired 100% of the outstanding shares of OMVL SpA and OMVL’s 51% share of Juniper Engines Inc. (“Juniper”), for a combined consideration of €19.0 million (approximately US$23.4 million). Westport expects to pay €11.4 million (approximately US$14 Million) on closing and €7.6 million (approximately US$9.4 million) on the third anniversary of the closing date. The purchase price will be subject to a downward or, as the case may be, upward adjustment equal to the consolidated net cash position as of the closing date. The transaction, which is expected to close on or about July 2, 2010, is subject to customary closing conditions. As a result of the transaction, Juniper, previously a joint venture between wholly owned subsidiaries of Westport Innovations Inc. and SIT Group of Italy, will become, indirectly, wholly owned by Westport. Ian Scott, President of Juniper Engines, will manage the combined companies while Maurizio Grando, Managing Director of OMVL, will continue to manage the Italian operations.
“Since the formation of our Juniper Engines joint venture with OMVL over two years ago, we have worked together to develop a new approach to alternative fuel, light-duty engines,” said David Demers, CEO of Westport Innovations. “With the successful launch of our first Juniper products, and the rapid development of global markets for alternative fuel engines, we have concluded that this strategic combination, with access to Westport’s large intellectual property portfolio, could position Juniper as a significant market participant in light-duty engines. As part of Westport’s light-duty strategy, OMVL provides access to proven, high quality, multi-point fuel injection technology and world class production and assembly facilities to help develop and sell products for natural gas vehicles.”
The total purchase price of approximately US$23.4 million is being financed through a combination of proceeds from cash generated from the recent warrant exercise and general operating funds.
Business & Financial Highlights for OMVL include:
The integration of OMVL will complete Juniper’s light-duty strategy to enter the mobile industrial, non-mobile industrial, and automotive segments. Juniper will grow the business through new OEM relationships and continued strong aftermarket sales, leveraging OMVL’s capabilities and assembly facilities in Italy and Argentina that today supply Europe, Asia and the Americas. Strategic investments in new markets and OEM-class products and capabilities will allow Juniper to compete for leadership in the light-duty alternative fuels market.
Westport has scheduled a conference call for today, Friday, July 2, 2010 at 7:00 am Pacific Time (10:00 am Eastern Time) to discuss this acquisition. The public is invited to listen to the conference call in real time by telephone or webcast. To access the conference call by telephone, please dial: 1-800-319-4610 (Canada & USA toll-free) or 604-638-5340. The live webcast of the conference call can be accessed through the Westport website.
To access the conference call replay after the call, please dial 1-800-319-6413 (Canada & USA toll-free) or 604-638-9010 using the pass code 1847. The replay will be available until July 16, 2010; however, the webcast will be archived on the Company’s website. Replays will be available in streaming audio shortly after the conclusion of the conference call.
OMVL is based in Pernumia, Italy and is a leading global player in the alternative fuel vehicles sector. OMVL designs, manufactures and markets complete fuelling systems for new vehicles and for the aftermarket conversion of engines from gasoline (petrol) to compressed natural gas (CNG) and liquified petroleum gas (LPG). OMVL currently collaborates with global manufacturers of motor vehicles, including Volkswagen and PSA Peugeot Citroën, with sales in Europe, the Americas and Australasia. OMVL has production and distribution capabilities in Europe, South America, Australia, and China.
Westport Innovations Inc. is a leading global supplier of proprietary solutions that allow engines to operate on clean-burning fuels such as compressed natural gas (CNG), liquefied natural gas (LNG), hydrogen and biofuels such as landfill gas. The Westport GX engine and LNG system for heavy-duty Class 8 trucks offers class-leading emissions and allows trucking fleets to move to lower-cost, domestically available natural gas. Cummins Westport Inc., Westport’s joint venture with Cummins Inc., manufactures and sells the world's broadest range of low-emissions alternative fuel engines for commercial transportation applications such as trucks and buses. BTIC Westport Inc., Westport’s joint venture with Beijing Tianhai Industry Co. Ltd., manufactures and sells LNG fuel tanks for vehicles. Westport’s Juniper Engines Inc. offers light-duty LPG and natural gas engine solutions for industrial applications such as forklifts and light-duty automotive. To learn more about our business, visit our website or subscribe to our RSS feed at www.westport.com, or follow us on Twitter @WestportWPRT.
Note: This document contains forward-looking statements about Westport’s business, operations, technology development or the environment in which it operates including the accretive nature of the acquisition and expected revenues, which are based on Westport’s estimates, forecasts and projections. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict, or are beyond Westport’s control. Consequently, readers should not place any undue reliance on such forward-looking statements. In addition, these forward-looking statements relate to the date on which they are made. Westport disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
At Westport Fuel Systems, we are driving innovation to power a cleaner tomorrow. We are inventors, engineers, manufacturers and suppliers of advanced clean fuel systems and components that can change the way the world moves. Our technology delivers performance, fuel efficiency and environmental benefits to address the challenges of global climate change and urban air quality. Headquartered in Vancouver, Canada, we serve our customers in more than 70 countries with leading global transportation brands. At Westport Fuel Systems, we think ahead. For more information, visit www.wfsinc.com.
This document contains forward-looking statements, including statements regarding the demand for our products, the future success of our business and technology strategies, investment, cash and capital requirements, intentions of partners and potential customers, the performance and competitiveness of our products and expansion of product coverage, future market opportunities, speed of adoption of natural gas for transportation, growth in demand as a result of new emission standards and terms of future agreements. These statements are neither promises nor guarantees, but involve known and unknown risks and uncertainties and are based on assumptions that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activities, performance or achievements expressed in or implied by these forward looking statements. These risks and assumptions include risks and assumptions related to our revenue growth, operating results, industry and products, the general economy, conditions of and access to the capital and debt markets, governmental policies and regulation, technology innovations, fluctuations in foreign exchange rates, global government stimulus packages, the acceptance of natural gas vehicles in fleet markets, the relaxation or waiver of fuel emission standards, the inability of fleets to access capital or government funding to purchase natural gas vehicles, the sufficiency of bio methane for use in our vehicles, the development of competing technologies as well as other risk factors and assumptions that may affect our actual results, performance or achievements or financial position discussed in our most recent Annual Information Form and other filings with securities regulators. Readers should not place undue reliance on any such forward-looking statements, which speak only as of the date they were made. We disclaim any obligation to publicly update or revise such statements to reflect any change in our expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward looking statements except as required by National Instrument 51-102.