Inverpower Controls Enters into 35-Day Exclusivity ArrangementJune 10, 2001 by Jeff Shepard
Inverpower Controls Ltd. (Toronto, Canada) announced that it has entered into a 35-day exclusivity arrangement with a publicly traded company to permit exclusive negotiations towards a possible sale of the assets of the business, and assumption of agreed-upon trade payables (asset sale) based upon a value of $6.0 million. Part of the ongoing negotiations include the method in which the sale of the assets and assumed liabilities will be conveyed to the potential purchaser.
The secured creditors hold CDN$8.5 million of convertible debentures and CDN$5.0 million of term and bridge loans. The accrued interest on this secured debt is currently CDN$1.2 million. The total principal and accrued interest of $14.7 million exceeds the proposed proceeds from the asset sale of approximately CDN$9.0 million. Based on Inverpower’s situation, the company was suspended from trading on the Toronto Stock Exchange as of June 1, 2001, for failure to meet continuing listing requirements. The company encouraged shareholders to contact their brokers to understand the impact of this decision on their personal holdings.
Among the assets to be acquired by the potential purchaser will be contracts in progress. Inverpower announced it has received two orders from Siemens-Westinghouse Power Corp. for power conditioning systems for a pressurized solid oxide fuel cell, which will be installed in Germany and is to be operated by the German utility RWE Energie AG, in a project partially funded by the US Department of Energy.