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ATS withdrawing Photowatt Technologies' IPO
ATS Automation Posted 03/28/2007
CAMBRIDGE, ON, March 27 /CNW/ - ATS Automation Tooling Systems Inc., in consultation with BMO Capital Markets and UBS Investment Bank, today announced that it is withdrawing its Initial Public Offering of shares in Photowatt Technologies Inc.
‘‘Our primary goal in launching this IPO was to fund an accelerated expansion of Photowatt and generate value for ATS shareholders,’‘ said Ron Jutras, ATS President and CEO. ‘‘Unfortunately, due to market conditions, we were not able to complete an IPO on terms that were acceptable to us. Also factoring into our decision was that fourth quarter solar revenues were below expected levels. This was largely due to two shipments - totalling approximately 4 million Euros - originally scheduled to be made by Photowatt in late March that have now been postponed by the customers. This backdrop was not supportive of proceeding with the IPO.’‘
Photowatt's capacity expansion, launched earlier this fiscal year, is now complete, meaning total integrated nameplate capacity is now 60 megawatts. Photowatt will continue to maintain its preparedness to enable the second phase of expansion to 100 megawatts to proceed once funding is secured.
In light of today's announcement, Mr. Jutras said, ‘‘we fully expect to use the upcoming period to further develop and strengthen our solar business. In part, we intend to realize the benefits from now expanded capacity, while we further our key strategic initiatives and relationships related to R&D, metallurgical silicon usage and additional long-term silicon supply. Without financing available from the IPO, we are re-evaluating all of the capital needs of the solar group, including ongoing Spheral Solar development. We believe these actions will strengthen Photowatt and better position it to secure financing at the appropriate time.’‘
ATS Automation Tooling Systems Inc. provides innovative, custom designed, built and installed manufacturing solutions to many of the world's most successful companies. Founded in 1978, ATS uses its industry-leading knowledge and global capabilities to serve the sophisticated automation systems' needs of multinational customers in healthcare, computer/electronics, automotive and consumer products. Through its solar business, ATS participates in the growing solar energy industry. It also leverages its many years of repetitive manufacturing experience and skills to produce, in high volume, precision components and subassemblies and to answer the specialized repetitive equipment manufacturing requirements of customers. ATS employs approximately 3,500 people at 25 manufacturing facilities in Canada, the United States, Europe, southeast Asia and China. The Company's shares are traded on the Toronto Stock Exchange under the symbol ATA.
Note to Readers
This press release contains certain statements that constitute forward-looking information within the meaning of applicable securities laws (‘‘forward-looking statements’‘). Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of ATS, or developments in ATS's business or in its industry, to differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. Forward-looking statements include all disclosure regarding possible events, conditions or results of operations that is based on assumptions about future economic conditions and courses of action. Forward-looking statements may also include, without limitation, any statement relating to future events, conditions or circumstances. ATS cautions you not to place undue reliance upon any such forward-looking statements, which speak only as of the date they are made. Forward-looking statements relate to, among other things, maintaining preparedness to enable the second phase of expansion to 100 megawatts, further development and strengthening of solar business, realizing the benefits from now expanded capacity, furthering key strategic initiatives and relationships, re-evaluation of the capital needs of the solar group, strengthening of Photowatt through initiatives to be taken, and the ability to secure more attractive financing at the appropriate time. The risks and uncertainties that may affect forward-looking statements include, among others; general market performance; market performance within the solar sector; ability to secure required funding for the solar business; performance of ATS's solar business; whether or not Photowatt, Clean Venture 21 Corporation and Fujipream Corporation will conclude a definitive agreement related to advancing sphere-based solar technology, risks involved in successfully developing and commercializing sphere-based solar technology on a cost-effective basis, including whether or not technical solutions exist, are available, can be discovered, and are economically feasible, and potential delays in finding technical solutions; problems with the equipment used in the optical fused powder (‘‘OFP’‘) process; unforeseen problems with Photowatt France's use of OFP silicon produced by the Spheral Solar technology and/or refined metallurgical silicon; the risk that desired cell efficiencies relating to refined metallurgical grade silicon technology cannot be achieved and/or that the market is unreceptive to lower efficiency cells and as a result it is not an economically viable alternative to the use of conventional solar grade silicon; equipment, labour or other issues that may arise with respect to the Spheral Solar technology being used in conversion of silicon for Photowatt International S.A.S.; reversal of current silicon supply arrangements, inability to finalize agreements, strategic partnerships, or alliances to provide for silicon supply and other problems that may be encountered with silicon supply sources; potential for silicon prices to decline in the face of long term silicon supply arrangements; ability to achieve lower silicon usage relative to conventional solar technology; possibility that selling price increases and improvements in production efficiencies will not be obtained and/or, if they are, will not be sufficient to offset higher silicon costs and shortages; the cost and availability of silicon, including silicon powder and fines, and other raw materials and certain specialized manufacturing tools and fixtures used in the production of the solar business' products; the successful expansion of production capability and adoption of new production processes; the extent of market demand for solar products such as those developed by the solar business; the availability and timing of government subsidies for solar products, the development of superior or alternative technologies to those developed by the solar business; and other risks detailed from time to time in ATS's filings with Canadian provincial securities regulators, including ATS's Management's Discussion and Analysis, Consolidated Financial Statements, Annual Report and Annual Information Form for the fiscal year ended March 31, 2006. Forward-looking statements are based on management's current plans, estimates, projections, beliefs and opinions, and ATS does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change.
For further information:
Carl Galloway, Vice President and Treasurer
Gerry Beard, Vice President and Chief Financial Officer