Wednesday June 29, 2016 0 comments
LONGMONT -- UQM Technologies, Inc. (NYSE MKT: UQM) today announced a definitive stock issuance and purchase agreement with American Compass, Inc., a wholly-owned subsidiary of Hybrid Kinetic Group Limited (“HKG”).
HKG is a Bermuda incorporated corporation with headquarters in Hong Kong. The agreement calls for HKG, through its wholly-owned subsidiary, to purchase newly issued UQM common shares that will represent 58% of UQM, and 54% on a fully-diluted basis.
The purchase price is $0.72 per share, which represents a 6.4% premium over the 90-day closing price average for the period ending on the last trading date before signing and a 14% premium over June 28’s closing price.
The transaction will bring approximately $48 million in cash to UQM. The terms of the agreement were unanimously approved by the boards of directors of both companies. UQM shareholders will continue to hold their shares in UQM and UQM stock will continue to be traded on the NYSE MKT.
The transaction, which is subject to usual and customary closing conditions, requires approval by two-thirds of UQM’s outstanding shares as well as the shareholders of HKG.
Closing is expected to occur as soon as possible following shareholders’ approval and receipt of approval by the Committee on Foreign Investment in the United States (CFIUS) and the required Hong Kong regulatory authorities.
The parties expect the closing will occur within the next six months.
Following the closing of the transaction, UQM will continue to support its existing customers around the world as well as new business development programs. UQM’s headquarters will remain in Longmont.
As part of the agreement, the parties have agreed that following the closing, UQM’s board will be increased to nine directors composed of UQM’s current CEO, three current UQM independent directors and five directors nominated by HKG.
HKG, which is publically listed on the Stock Exchange of Hong Kong (Stock Code: 01188), engages principally in the environmental automobile and related business. It develops and manufactures batteries and battery management systems and develops and manufactures electric and hybrid vehicles.
HKG has a market capitalization of approximately $600 million.
“We are thrilled to be joining forces with HKG,” said Joe Mitchell, UQM resident and CEO. “Finding a strong strategic partner in Asia has been a priority for UQM with our potential partner meeting three key criteria: 1) provide the necessary capital to allow us to enter the China market; 2) provide the infrastructure to support our continuing product development and operations; and 3) provide access to customers in China to grow our business.
“The investment by, and continuing partnership with HKG, accomplishes all of these criteria. We believe HKG’s knowledge and experience in the new energy market in China will enable us to accelerate our strategic initiatives and make us a stronger competitor in North America and globally, while creating long-term shareholder value.
“This alliance provides UQM with access to the largest electric vehicle market in the world and provides us with a much stronger competitive position in the global market for electric vehicles. We think this is a great win for our shareholders, customers, and employees."
"We are delighted to welcome UQM to the HKG organization," said Dr. Yeung Yung, HKG chairman. "UQM has developed the world’s leading electric propulsion systems and has a team of talented people that is second to none.
“We are excited about UQM's future growth prospects and the value that each party brings to the new alliance."