GENEVA, SWITZERLAND -- (Marketwire) -- 08/09/10 -- Etrion Corporation ("Etrion" or the "Company") (TSX: ETX), an independent solar power producer, has signed a definitive sale and purchase agreement to acquire the 33 megawatt ("MW") Montalto solar power plant from US-based SunPower Corp. ("SunPower") (NASDAQ: SPWRA; SPWRB) for cash consideration of approximately 48 million euros plus the assumption of the related non-recourse loan facilities. The Montalto plant, which SunPower owns through its recently acquired project development arm, SunRay Renewable Energy, is currently the largest solar power park in Italy.
Marco Northland, the Company's CEO, commented, "We recently announced signing a term sheet for this transaction, and we are pleased to move forward to close the acquisition of the 33 MW Montalto solar park. This acquisition more than triples the size of our company in terms of installed capacity and cash flow and makes us one of the major solar power producers in Italy. We expect to exit 2010 with almost 50 MW in operation and more than 150 MW in pipeline for future development."
The 33 MW solar power plant is expected to produce over 55 million kilowatt hours ("kWh") of electricity and approximately 22 million euros of cash flow ("EBITDA") per year.
The 33 MW that Etrion is acquiring consists of two projects located on the same site in the Lazio region of Italy near Rome. The first project is 24 MW and was connected to the grid in November 2009. The second project is approximately 9 MW and is currently under construction for completion in August 2010. Both projects are ground-based solar photovoltaic ("PV") power plants using SunPower's high-efficiency PV modules and single axis tracker technology.
The 24 MW project benefits from the 2009 feed-in-tariff of 0.353 euros per kWh plus a market price of approximately 0.08 euros per kWh. The 9 MW project is expected to benefit from the 2010 feed-in-tariff of 0.346 euros per kWh plus a market price of approximately 0.08 euros per kWh.
The Italian feed-in-tariff is a premium purchase price for renewable electricity that is guaranteed by the Italian government for 20 years from the start of operations.
The 24 MW plant has an existing facility agreement with Societe Generale, Banca Infrastrutture Innovazione e Sviluppo (Intesa Sanpaolo Group) and WestLB for 107 million euros. Societe Generale's participation in the financing is partially guaranteed by SACE, the Italian export credit agency. The 9 MW plant has an existing facility agreement with Barclays for 40 million euros.
The acquisition of the 24 MW project has been completed. The acquisition of the 9 MW project remains subject to standard closing conditions and is expected to close by September 30, 2010.
The Company is funding the acquisition through a bridge loan from its major shareholder, Lundin Petroleum.
About the Company
Etrion Corporation is focused on building, owning and operating electrical power plants based on renewable sources of energy, including solar photovoltaic. The Company is listed on the Toronto Stock Exchange (ticker symbol "ETX") and is based in Geneva, Switzerland with an office in Rome, Italy. Etrion is owned 45% by Lundin Petroleum, a Swedish independent oil and gas company traded on the NASDAQ OMX Stockholm exchange (ticker symbol "LUPE"), and approximately 13% by the Lundin family through various trusts.
The capacity of power plants in this release is described in approximate megawatts on a direct current (dc) basis unless otherwise noted.
Forward-Looking Information:
This press release contains certain "forward-looking information". All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements relating to the acquisition of the SunPower Montalto projects, the production capacity thereof and the expected cash flow therefrom) constitute forward-looking information. This forward-looking information reflects the current expectations or beliefs of the Company based on information currently available to the Company as well as certain assumptions including, without limitation, assumptions as to the price at which the Company will be able to sell electricity from the Montalto projects and the anticipated timing of completion of the Montalto 9 MW project and an assumption that the Company will be able to realize EBITDA margins for the Montalto project that are equivalent to the average margins for similar projects. Forward-looking information is subject to a number of significant risks and uncertainties and other factors that may cause the actual results of the Company to differ materially from those discussed in the forward-looking information, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the Company. Factors that could cause actual results or events to differ materially from current expectations include, but are not limited to, the failure to close the acquisition of the Montalto 9 MW project, the possibility of project cost overruns or unanticipated costs and expenses or delays in construction of such project and the failure to obtain necessary regulatory and other approvals.
Any forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein.
Contacts:
Etrion Corporation
Garrett Soden
Chief Financial Officer
+41 (22) 715 20 90
+41 (22) 715 20 99 (FAX)
www.etrion.ch
