Beacon Power Announces Plans to Acquire NxtPhase
Beacon Power Corp. (Wilmington, MA), a designer of advanced products for electric power and grid voltage and frequency regulation, announced that it has entered into an agreement to acquire NxtPhase T&D Corp. (Vancouver, BC, Canada), a supplier of digital and fiber optic products for electric power and grid monitoring and control. Under the agreement, at closing, Beacon will acquire NxtPhase for approximately 15.7 million new common shares of Beacon (subject to adjustment as described in the agreement), which will be distributed to NxtPhase investor shareholders. Also, immediately after closing, Beacon will grant restricted stock units covering approximately 2.7 million new common shares of Beacon to the NxtPhase employees.
The agreement results from introductions made by Perseus LLC. An aggregate of $4.4 million of equity financing has also been committed to Beacon and to NxtPhase by a fund affiliated with Perseus. Perseus has committed to invest $2.9 million in Beacon to fund operations, in exchange for approximately 3.5 million newly issued Beacon common shares. Perseus has also committed $1.5 million of equity financing to fund NxtPhase operations during and after the acquisition. Beacon has agreed to issue warrants covering up to 1.22 million shares to Perseus, exercisable at $1.01 per share. In addition, Perseus has paid $100,000 to Beacon Power to extend by two years (until May 23, 2007) preexisting warrants that are already held by Perseus, covering 1,333,333 Beacon shares at an exercise price of $2.25 per share. Perseus, NxtPhase and Beacon Power are affiliates of one another.
Beacon Power President and CEO Bill Capp said, "The acquisition of NxtPhase, a leading supplier of advanced grid electronics, is consistent with our commitment to provide the most innovative solutions for today's electrical grid. Both Beacon and NxtPhase share a common vision, with complementary technologies and cultures. We believe the two companies will be stronger as a combined entity in terms of customer base, market access, technology portfolio, product development opportunities, and outside investment potential. This acquisition will bring an immediate increase to Beacon's revenue and, we believe, lead to greater shareholder value."