Power Clouds Inc. Enters Italian Renewable Energy Market With Completion Of $5.5 Million Acquisition Of First Two Photovoltaic Parks, Consisting Of 1.7MW Of Installed Power With Expected Annual Revenues Of $800,000 For The Next 15 Years
Power Clouds Inc. recently announces that it recently completed the acquisition of its first two solar PV parks in Italy. The total aggregate value of the two individual transactions is €5.0 million (circa $5.5 million) and gives PWCL operating green energy plants in Italy delivering annual revenues of approximately $800,000 for the next 15 years. The acquisitions increase PWCL’s overall installed power by 28%, over the 6.1MW of operational parks in Romania, and increases its annual revenues by approximately 80% due to the higher feed-in-tariffs paid in Italy. The parks currently deliver 80% in annual EBITDA before debt service, have each been operating for over 4 years and bring immediate profitable net income and cash flows to PWCL. These are the first of the previously announced Letters of Intent (LOI’s) for the acquisition of up to 12MW of operational PV parks in Italy.
The total consideration for the acquisitions was funded by way of cash payments totaling €1.3m ($1.4m) paid by PWCL, issuance of non-convertible loan notes of €1.8m ($1.95m) and a total of 10m shares of PWCL restricted common stock (valued at $0.8m), 4.2m of which was already issued in July 2016. The Company also assumed existing leasing debt of €1.2m ($1.3m) on one of the parks which is paid from the existing cash flows of the park. The transactions closed on March 30, 2017, through two wholly owned subsidiaries in Italy that took control of the Special Purpose Vehicles (SPV’s) that own the individual parks and the operating licenses, following extensive legal, financial and technical due diligence by Orrick Henderson & Sutcliff (Europe) LLC, Price Waterhouse Coopers in Italy and PROTOS spa. Details of the transactions have also been filed in Supplemental Information Reports with OTC Markets at http://www.otcmarkets.com/stock/PWCL/filings.
Roberto Forlani, Chairman and Chief Executive Officer of PWCL, said, “This is another significant, and personally satisfying, development for PWCL. We have been working on expanding our operations to Italy for over a year now and so to complete the first two, of many we have planned there, is truly a breakthrough for us. Strategically, we now have operating plants in two European countries with more countries planned moving forward. The immediate goal for us now is to finalize the other contracts we have in Italy and expand our presence there. In addition to the current LOI’s for 12MW we are currently in tender processes for an additional 90MW for acquisition this year based on active tenders and negotiations and we see Italy as a central part of our growth in Europe over the next 18 months. The completion of these acquisitions not only proves our new business model of acquiring existing operational parks – that bring immediate positive cash flows – but also shows the markets that we are once again growing and plan to increase that growth rate in 2017 and beyond.”