TAMPA, Florida, September 26, 2017 /PRNewswire/ --
MagneGas Corporation ("MagneGas" or the "Company")
(NASDAQ: MNGA), a leading clean technology company in the renewable
resources and environmental solutions industries, announced today
that it has received a preliminary purchase order for a
$1.9 million gasification unit. In
addition, the Company announced it plans to form a joint venture,
in which it will hold a 40% minority stake and will include a
commitment from the European partner to purchase multiple
gasification units from MagneGas in the near term. The prospective
European partner has conducted extensive marketing and business
validation, along with a top tier global consulting firm, and
has generated significant interest among potential customers,
including leading companies in the shipping, heavy industry,
transportation and agricultural sectors. The European partner
and their global consulting firm have assessed that customers who
switch from acetylene to MagneGas2® would be eligible for carbon
credits which can add materially to the value proposition.
Key highlights of the proposed partnership
include:
- Initial Purchase Order: The prospective partner agreed to
purchase a 300KW gasification unit, which should enable MagneGas to
fulfill the entire purchase commitment by December 31, 2017.
- Operating Lease: MagneGas agreed to lease a second unit
to the prospective partner for immediate use for up to six months
in order for the partner to demonstrate its operating capabilities
to prospective European consumers of the MagneGas2® product.
- Minority Stake: MagneGas will take an initial 40%
ownership in the European partnership. MagneGas will retain
certain rights to increase or decrease its stake under certain
conditions.
- Purchase Option: The prospective European partner will
exercise an initial purchase option on up to 5 additional 300KW
gasification units.
- Exclusivity: Upon meeting certain conditions, the
prospective European partner will be obligated to deposit 50% of
the purchase price on the additional 5 units in order to secure
certain exclusivity rights for the marketing and sale of MagneGas
gasification units and MagneGas2 in Europe.
- Consulting: MagneGas has also agreed to provide certain
technical and marketing consulting resources over the next six
months that will be billable in full to the European partnership
for up to $500,000.
All of the outlined items detailed above are expected to
commence by October 1, 2017 and be
completed by March 31, 2018.
The European partnership is expected to begin commercial
operations in Q4 of 2017 using the leased gasification unit in
Florida, with a transition to full
operational capacity in northern Europe by the end of Q2 2018.
"This is a major breakthrough for MagneGas in penetrating the
European market, which we have explored with our partner's R&D
team for years," commented Ermanno
Santilli, Chief Executive Officer of MagneGas Corporation.
"We were very impressed with the level of financial
preparedness, the local market and customer knowledge, and the
operational preparations initiated by our prospective European
partners. Our recent meetings in Europe revealed the amount of due diligence
performed not only by our future partners, but also by the global
consulting firm they are working closely with. We are firmly
convinced that the European market has massive potential for our
MagneGas technology. Europe is years ahead of the United States in terms of clean
technology, environmental sensitivity, and end market demand for a
cleaner, safer industrial sector. Our product fits their
demands perfectly, and we see a major opportunity to accelerate
growth into this new market."
"The European markets are ideally suited for MagneGas2®, and as
the only renewable metal working fuel in the world, the
availability of carbon credits makes the value proposition even
stronger. We recently met with our prospective partner's key
executives, as well as their consulting firm, and conducted
inspections in Europe in order to
fully validate the commercial opportunity as presented," commented
Scott Mahoney, Chief Financial
Officer of MagneGas Corporation. "The financial ramifications
of what has been presented to our executive team are very
meaningful. We have the opportunity to generate record
revenues, cash flows and profitability in the immediate term as a
result of the proposed partnership."
About MagneGas Corporation
MagneGas® Corporation (MNGA) owns a patented process that
converts various renewables and liquid wastes into MagneGas fuels.
These fuels can be used as an alternative to natural gas or for
metal cutting. The Company's testing has shown that its metal
cutting fuel "MagneGas2®" is faster, cleaner and more productive
than other alternatives on the market. It is also cost effective
and safe to use with little changeover costs. The Company
currently sells MagneGas2® into the metal working market as a
replacement to acetylene.
The Company also sells equipment for the sterilization of
bio-contaminated liquid waste for various industrial and
agricultural markets. In addition, the Company is developing a
variety of ancillary uses for MagneGas® fuels utilizing its high
flame temperature for co-combustion of hydrocarbon fuels and other
advanced applications. For more information on MagneGas®,
please visit the Company's website at http://www.MagneGas.com.
The Company distributes MagneGas2® through Independent
Distributors in the U.S and through its wholly owned distributor,
ESSI (Equipment Sales and Services, Inc). ESSI has four locations
in Florida and distributes
MagneGas2®, industrial gases and welding supplies. For more
information on ESSI, please visit the company's website at
http://www.weldingsupplytampa.com.
The MagneGas IR App is now available for free in Apple's
App Store for the iPhone or iPad
http://bit.ly/AfLYww and at Google Play http://bit.ly/Km2iyk for
Android mobile devices.
To be added to the MagneGas investor email list, please email
pcarlson@kcsa.com with MNGA in the subject line.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements as
defined within Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. These statements relate to future events, including
our ability to raise capital, or to our future financial
performance, and involve known and unknown risks, uncertainties and
other factors that may cause our actual results, levels of
activity, performance, or achievements to be materially different
from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking
statements. You should not place undue reliance on forward-looking
statements since they involve known and unknown risks,
uncertainties and other factors which are, in some cases, beyond
our control and which could, and likely will, materially affect
actual results, levels of activity, performance or achievements.
Any forward-looking statement reflects our current views with
respect to future events and is subject to these and other risks,
uncertainties and assumptions relating to our operations, results
of operations, growth strategy and liquidity. We assume no
obligation to publicly update or revise these forward-looking
statements for any reason, or to update the reasons actual results
could differ materially from those anticipated in these
forward-looking statements, even if new information becomes
available in the future.
For a discussion of these risks and uncertainties, please see
our filings with the Securities and Exchange Commission. Our public
filings with the SEC are available from commercial document
retrieval services and at the website maintained by the SEC at
http://www.sec.gov .
Investor Contacts:
Crescendo Communications
T: 844-589-8760
mnga@crescendo-ir.com
SOURCE MagneGas Corporation