Emcore announces agreement to acquire Tecstar's applied solar division and releases financial results
* The acquisition will make Emcore the world s largest independent solar panel integrator.
* The transaction will be accretive immediately.
The transaction will make Emcore the world s largest independent solar panel integrator. Under the terms of the agreement, which was signed by the parties on February 6, 2002, Emcore will pay $21 million for the solar cell business and operations of Tecstar. The acquisition will also vertically integrate all aspects of satellite solar panel construction within Emcore and provide Emcore with solar panel manufacturing expertise with a proven flight heritage dating back to 1958.
The Tecstar acquisition enables Emcore to further penetrate the satellite communications market by expanding the company s product offerings to include CICs (cover interconnect cells) and solar panels. Emcore will now offer solar array integrators and satellite manufacturers a single supply source to meet their power requirements. The solar panel array is a critical sub-assembly in satellite manufacturing. The greater the efficiency (light-to-energy conversion) in a solar panel, the more transponders a satellite can support. This results in more capacity to transmit data and a corresponding increase in satellite revenues. Emcore currently manufactures the most efficient radiation hard solar cell in the world, with a beginning of life efficiency of 27.5%.
Tecstar, the industry s first solar cell manufacturer for space applications, has an impressive 40+ year history of providing fully integrated solar panels that have powered many well known space programs such as the NASA Mars Pathfinder. With proven flight processes and solar panel service to all major satellite solar array integrators in the US and most international suppliers, Tecstar s experience and firmly established track record with customers will be paramount to Emcore s increasing success in the satellite communications sector.
Reuben F. Richards, Jr., President and CEO of Emcore, stated, "Emcore has the most advanced solar cell technology available today. By acquiring Tecstar, we are combining our industry-leading technology with Tecstar s proven flight heritage to offer manufacturers an integrated solution to meet all of their satellite power needs from a single source. As a result of this added capability, Emcore will play a more direct role in a satellite s on-orbit success.
Bryon Borgardt, Vice President and Chief Financial Officer of Tecstar, added, "We are excited that the Tecstar heritage will continue under the leadership of Emcore, where our team can combine its experience with Emcore s innovative photovoltaic technology to create the best solar panels available. We are confident that Emcore s leading solar cell technology will provide the building blocks to achieve greater satellite performance, while Tecstar s history of success with major satellite providers will enhance these efforts.
The acquisition will be effected through a Chapter 11 reorganization of Tecstar. The motion to approve the sale of certain Tecstar assets to Emcore will be filed with the Delaware Bankruptcy Court this week and requires Bankruptcy Court approval. The proceeds from the Emcore transaction and the disposition or reorganization of Tecstar s remaining assets will be used for the payment of Tecstar s creditors. The Tecstar transaction is expected to be immediately accretive to Emcore shareholders.
Financial results
Emcore reported a loss for the quarter ending December 31, 2001, of $31 million and revenues of $19.1 million. This compares to an $11.4 million loss and $39.1 million in revenue for the same period a year ago. The company said that it expected second quarter revenues to rise by 15-20% from the first quarter.
Tom Werthan
+1 732-272-9090
E-mail: escinfo@emcore.com
Web site: http://www.emcore.com
