LGC Skyrota Wind Energy Corporation announced it has completed the acquisition of the business and assets of Limavady Gear Company (LGC), a leading European provider of wind turbine maintenance services.
Terms of the acquisition include a cash payment of CDN$680,000 and 15,686,500 common shares and 2,000,000 warrants. The company also closed a concurrent public offering of CDN$3,500,000 at 12.5 cents per share.
LGC Skyrota operates two business divisions:
· LGC, which rebuilds gearboxes for large wind turbines; and
· Skyrota, which manufactures a revolutionary 5kW small vertical-axis wind turbine.
"This deal brings together two businesses that have excellent opportunities in the rapidly growing wind energy sector. The European market in particular has a number of compelling aspects, including much higher electricity rates than North America, dedicated government support and a large installed base," said Thomas Braun, president and CEO of LGC Skyrota. "LGC is strongly positioned to service the approximately 3,500 large utility-size wind turbines currently operating in the U.K. and Ireland – each of these turbines will require gearbox rebuilding at least twice in their lifetimes, at an average rebuild cost of about CDN$50,000 each time. And there are several thousand more large turbines in the planning stages as governments across Europe pursue renewable energy strategies to meet targets set by EU Directives and the Kyoto Protocol."
"The innovative Skyrota turbine was originally developed by LGC to meet the growing demand for small wind systems. The market potential for Skyrota is tremendous according to a recent British Wind Energy Association study. From a cumulative total of 10,000 small wind systems deployed in the UK in 2005, the association estimates more than 600,000 could be installed in the next 10 years. We are confident that our advantages in each of our two divisions will capture these market opportunities and drive our future growth," said Braun.
The Skyrota 5-kilowatt high-efficiency vertical-axis wind turbine was a prominent feature at Glastonbury 2009, providing power to the event from beside the main Pyramid stage. The Skyrota turbine was also recently chosen for the Long Sutton Earth-Sheltered Social Housing Project for its revolutionary design. It is currently sold exclusively through distributors in Ireland, the U.K. and Italy. The company is currently expanding its distribution network throughout Europe and has plans to enter the North American market at a later stage.
LGC is a fully equipped engineering firm that is applying its 30 years of experience in manufacturing replacement gears for the heavy industrial and marine industries to servicing utility-scale wind farms in Ireland and the U.K. from its base in Northern Ireland. It is ISO certified and is a member of the British Gear Association. LGC's current customers include Vestas, the largest wind turbine manufacturer in the world, along with Airtricity, Viridian Power, and Hibernian Wind Power.