Pioneer reaches agreement to sell transformer business for approximately £51m
In consideration for all the assets of Pioneer Transformers Ltd. and Pioneer Dry Type Transformer Group, which includes Jefferson Electric, Bemag Transformer and Harmonics, Pioneer will receive $65.5 million, including $60.5 million in cash and $5 million in a seller’s note.
In addition, Mill Point Capital will assume substantially all the current assets and liabilities, including payables for the acquired entities.
Pioneer will retain Pioneer Critical Power, a provider of generators, specialized enclosures, automatic transfer switches, uninterruptible power supplies, batteries, remote monitoring solutions, and RICE/NESHAP modifications, as well as a full suite of engine generator maintenance services. Service customers include several national retailers and cellular service providers.
Pioneer Custom Electrical Products, a supplier of highly specified and engineered solutions for the electrical power generation industry with special focus on the distributed generation and data center markets.
In addition, Pioneer continues to hold 1.75 million shares and warrants to purchase an additional 1 million shares of CleanSpark, Inc. (OTC: CLSK).
Nathan Mazurek, Pioneer’s Chairman and Chief Executive Officer, said, “Our belief that our assets were worth more individually than the market valuation of our combined organization is validated by this transaction, wherein we will divest a portion of our business for approximately 1.5x our current market capitalization, while retaining two exciting businesses and our status as a publicly traded Nasdaq listed company.
“Following the closing of this transaction, we plan to focus on streamlining and enhancing our Titan business in Minneapolis and our switchgear business in Los Angeles. With a strong balance sheet, we should be well positioned to assess our retained businesses, potential opportunities and the allocation of resources to best benefit shareholders. I am excited about phase two of Pioneer.”
Lincoln International acted as the exclusive financial advisor to Pioneer Power Solutions, Pioneer management expects the transaction to close in the second half of 2019.
The transaction is subject to certain customary closing conditions and Mill Point securing financing for the transaction. Additional details are provided in filings with the Securities and Exchange Commission.
Source: Company Press Release.
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