AMSC (Nasdaq: AMSC), a leading system provider of
megawatt-scale power resiliency solutions
that orchestrate the rhythm and harmony of power on the
grid™ and protect and expand the capability of our Navy’s fleet,
today announced that it has acquired NWL, Inc. (NWL), a private
company based in New Jersey that provides power supplies to
industrial and military customers. At closing, AMSC paid $25
million in cash and issued 1,297,600 restricted shares of AMSC
common stock with a value of approximately $31.4 million. As part
of the transaction, AMSC will make an additional cash payment of $5
million, subject to various adjustments set forth in the stock
purchase agreement.
AMSC believes the acquisition of NWL directly aligns with the
company’s strategic priorities to accelerate profitable growth,
broaden its product offerings, and expand both market reach and
market share. NWL has a history of profitable revenue with a
three-year average of approximately $55 million in revenue per year
and operating margins approaching the teens. NWL supplies
components for a variety of energy applications. Their offerings
include power supplies and power controls to industrial and
military customers. NWL’s military progress, coupled with AMSC’s
own growth in this sector, is expected to further strengthen and
amplify the military power supply sales channel. By leveraging
NWL’s leadership position in the industrial and military markets,
AMSC expects to expand its business offerings and deliver greater
value to existing and new customers, business partners, and
shareholders.
“As we expand our military business, we believe NWL has the
potential of multiplying our military footprint within the US Navy
and the Department of Defense and given our recent work and success
with allied navies, the two companies together are expected to
provide a powerful combination,” said Daniel P. McGahn, Chairman,
President and CEO of AMSC. “NWL has established a leadership
position in the industrial and military markets for power products
that complements and scales our recent push into these markets. The
addition of NWL to AMSC’s Grid solutions is expected to accelerate
our ability to achieve our goal of sustainable profitability and
expand our offering of proprietary power products in the industrial
and military sectors.”
Fairmount Partners served as the exclusive merger and
acquisition advisor to NWL in this transaction. For more
information about the stock purchase agreement, please refer to
AMSC’s Form 8-K filed with the SEC today.
The Company intends to discuss this acquisition during its
previously announced conference call with investors to discuss the
Company’s financial results for the first quarter of fiscal 2024
and business outlook beginning at 10:00 a.m. Eastern Time on
Wednesday, August 7, 2024.
Those who wish to listen to the live or archived conference call
webcast should visit the “Investors” section of the Company’s
website at https://www.amsc.com. The live call can be accessed 15
minutes prior to the scheduled start time by dialing 1-844-481-2802
or 1-412-317-0675 and asking to join the AMSC call. A replay of the
call may be accessed 2 hours following the call by dialing
1-877-344-7529 and using conference passcode 9653245.
About NWL, Inc. (NWL)NWL is a leading
manufacturer and designer of transformers, inductors and power
supplies for industrial and defense applications. The company was
founded in the 1930’s by John Nothelfer as a transformer repair
shop – Nothelfer Winding Laboratories, hence the name NWL. For more
information, please visit: www.nwl.com
About AMSC (Nasdaq: AMSC)AMSC generates the
ideas, technologies and solutions that meet the world’s demand for
smarter, cleaner … better energy™. Through its Gridtec™ Solutions,
AMSC provides the engineering planning services and advanced grid
systems that optimize network reliability, efficiency and
performance. Through its Marinetec™ Solutions, AMSC provides
ship protection systems and is developing propulsion and
power management solutions designed to help fleets increase system
efficiencies, enhance power quality and boost operational
safety. Through its Windtec™ Solutions, AMSC provides wind
turbine electronic controls and systems, designs and engineering
services that reduce the cost of wind energy. The Company’s
solutions are enhancing the performance and reliability of power
networks, increasing the operational safety of navy fleets and
powering gigawatts of renewable energy globally. Founded in 1987,
AMSC is headquartered near Boston, Massachusetts with operations in
Asia, Australia, Europe and North America. For more information,
please visit www.amsc.com.
©2024 AMSC. AMSC, American Superconductor, Amperium, Gridtec,
Marinetec, Windtec, Orchestrate the Rhythm and Harmony of Power on
the Grid and Smarter, Cleaner … Better Energy are trademarks or
registered trademarks of American Superconductor Corporation. All
other brand names, product names, trademarks, or service marks
belong to their respective holders.
Forward-Looking StatementsThis press release
contains “forward-looking statements” within the meaning of Section
21E of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”). Such statements include, but are not limited to,
statements about our expectation that the addition of NWL to AMSC’s
Grid solutions will accelerate our ability to achieve our goal of
profitability; the expected effects and benefits of our acquisition
of NWL; our expectation that the NWL acquisition will be accretive
to our earnings per share; the additional payments required under
the terms of the stock purchase agreement; and other statements
containing the words “believes,” “anticipates,” “plans,” “expects,”
“will” and similar expressions. Such forward-looking statements
represent management’s current expectations and are inherently
uncertain. There are a number of important factors that could
materially impact the value of our common stock or cause actual
results to differ materially from those indicated by such
forward-looking statements. These important factors include, but
are not limited to: Risks related to the financial performance of
NWL and its affiliated entities; The NWL business may not be
integrated successfully; We may not realize the expected benefits
of our acquisition of NWL; We have a history of operating losses,
which may continue in the future. Our operating results may
fluctuate significantly from quarter to quarter and may fall below
expectations in any particular fiscal quarter; We have a history of
negative operating cash flows, and we may require additional
financing in the future, which may not be available to us; Our
technology and products could infringe intellectual property rights
of others, which may require costly litigation and, if we are not
successful, could cause us to pay substantial damages and disrupt
our business; Changes in exchange rates could adversely affect our
results of operations; We may be required to issue performance
bonds or provide letters of credit, which restricts our ability to
access any cash used as collateral for the bonds or letters of
credit; If we fail to maintain proper and effective internal
control over financial reporting, our ability to produce accurate
and timely financial statements could be impaired and may lead
investors and other users to lose confidence in our financial data;
We may not realize all of the sales expected from our backlog of
orders and contracts; Our contracts with the U.S. government are
subject to audit, modification or termination by the U.S.
government and include certain other provisions in favor of the
government. The continued funding of such contracts remains subject
to annual congressional appropriation, which, if not approved,
could reduce our revenue and lower or eliminate our profit; Changes
in U.S. government defense spending could negatively impact our
financial position, results of operations, liquidity and overall
business; Pandemics, epidemics or other public health crises may
adversely impact our business, financial condition and results of
operations; We rely upon third-party suppliers for the components
and subassemblies of many of our Grid and Wind products, making us
vulnerable to supply shortages and price fluctuations, which could
harm our business; Uncertainty surrounding our prospects and
financial condition may have an adverse effect on our customer and
supplier relationship; Our success is dependent upon attracting and
retaining qualified personnel and our inability to do so could
significantly damage our business and prospects; A significant
portion of our Wind segment revenues are derived from a single
customer. If this customer’s business is negatively affected, it
could adversely impact our business; Our success in addressing the
wind energy market is dependent on the manufacturers that license
our designs; Our business and operations would be adversely
impacted in the event of a failure or security breach of our or any
critical third parties' information technology infrastructure and
networks; We may acquire additional complementary businesses or
technologies, which may require us to incur substantial costs for
which we may never realize the anticipated benefits; Failure to
comply with evolving data privacy and data protection laws and
regulations or to otherwise protect personal data, may adversely
impact our business and financial results; Many of our revenue
opportunities are dependent upon subcontractors and other business
collaborators; If we fail to implement our business strategy
successfully, our financial performance could be harmed; Problems
with product quality or product performance may cause us to incur
warranty expenses and may damage our market reputation and prevent
us from achieving increased sales and market share; Many of our
customers outside of the United States may be either directly or
indirectly related to governmental entities, and we could be
adversely affected by violations of the United States Foreign
Corrupt Practices Act and similar worldwide anti-bribery laws
outside the United States; We have had limited success marketing
and selling our superconductor products and system-level solutions,
and our failure to more broadly market and sell our products and
solutions could lower our revenue and cash flow; We or third
parties on whom we depend may be adversely affected by natural
disasters, including events resulting from climate change, and our
business continuity and disaster recovery plans may not adequately
protect us or our value chain from such events; Adverse changes in
domestic and global economic conditions could adversely affect our
operating results; Our international operations are subject to
risks that we do not face in the United States, which could have an
adverse effect on our operating results; Our products face
competition, which could limit our ability to acquire or retain
customers; We have operations in, and depend on sales in, emerging
markets, including India, and global conditions could negatively
affect our operating results or limit our ability to expand our
operations outside of these markets. Changes in India’s political,
social, regulatory and economic environment may affect our
financial performance; Our success depends upon the commercial
adoption of the REG system, which is currently limited, and a
widespread commercial market for our products may not develop;
Industry consolidation could result in more powerful competitors
and fewer customers; Increasing focus and scrutiny on environmental
sustainability and social initiatives could increase our costs, and
inaction could harm our reputation and adversely impact our
financial results; Growth of the wind energy market depends largely
on the availability and size of government subsidies, economic
incentives and legislative programs designed to support the growth
of wind energy: Lower prices for other energy sources may reduce
the demand for wind energy development, which could have a material
adverse effect on our ability to grow our Wind business; We may be
unable to adequately prevent disclosure of trade secrets and other
proprietary information; Our patents may not provide meaningful or
long-term protection for our technology, which could result in us
losing some or all of our market position; There are a number of
technological challenges that must be successfully addressed before
our superconductor products can gain widespread commercial
acceptance, and our inability to address such technological
challenges could adversely affect our ability to acquire customers
for our products; Third parties have or may acquire patents that
cover the materials, processes and technologies we use or may use
in the future to manufacture our Amperium products, and our success
depends on our ability to license such patents or other proprietary
rights; Our common stock has experienced, and may continue to
experience, market price and volume fluctuations, which may prevent
our stockholders from selling our common stock at a profit and
could lead to costly litigation against us that could divert our
management’s attention; Unfavorable results of legal proceedings
could have a material adverse effect on our business, operating
results and financial condition; and the other important factors
discussed under the caption "Risk Factors" in Part 1. Item 1A of
our Form 10-K for the fiscal year ended March 31, 2024, and our
other reports filed with the SEC. These important factors, among
others, could cause actual results to differ materially from those
indicated by forward-looking statements made herein and presented
elsewhere by management from time to time. Any such forward-looking
statements represent management's estimates as of the date of this
press release. While we may elect to update such forward-looking
statements at some point in the future, we disclaim any obligation
to do so, even if subsequent events cause our views to change.
These forward-looking statements should not be relied upon as
representing our views as of any date subsequent to the date of
this press release.
AMSC ContactsInvestor Relations Contact:LHA
Investor RelationsCarolyn Capaccio(212) 838-3777amscIR@lhai.com
Public Relations Contact:RooneyPartnersJoe Luongo(914)
906-5903jluongo@rooneypartners.com
AMSC Director of Communications:Nicol GolezPhone:
978-399-8344Nicol.Golez@amsc.com
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