Today, ForceField Energy announced the completion of the sale of its 60% interest in Wendeng He Xie Silicon Co., Ltd. to the minority owner of Wendeng and the conclusion of its operations at Zibo Baokai Commerce and Trade Co., Ltd. Reportedly, completion of the two transactions strengthens ForceField Energy’s working capital, does away with the operating costs associated with these business segments, and enables ForceField Energy to pay stronger attention to its continuing key business segments.
With the closing of the Wendeng transaction, ForceField Energy received 1,462,097 shares of its restricted common stock, valued at around $8.6 million, and paid $50,000 in cash consideration. The restricted common stocks’ value was based on the closing market price on February 19, 2014, and ForceField Energy’s issued and outstanding share count will be reduced from 17.0 million shares to almost 16.5 million shares, as the common stock will be going into treasury.
In the case of the Baokai transaction, ForceField Energy concluded its Chinese distribution operations and transferred its 90% interest in Zibo Baokai Commerce and Trade Co., Ltd to that company’s minority owners. Under the terms of the agreements in both transactions, ForceField Energy will be indemnified from any present or future obligations or liabilities.
David Natan, ForceField Energy’s CEO, commented, “We are very pleased to complete this transaction and receive significant value in return for these TCS-based businesses located in China. The polysilicon marketplace remains depressed, and despite our best efforts to make these businesses profitable, we see no signs of recovery in the foreseeable future that justified maintaining those operations. This transaction benefits our shareholders, customers, and partners, and it will enable us to enhance our focus on delivering the highest quality LED lighting, smart electric meter, and waste heat to clean electricity products and services to our growing international customer base.”
Jason Williams, ForceField Energy’s CFO, commented, “Today’s announcement is a clear demonstration of our steadfast commitment to improve ForceField Energy’s financial performance and working capital by eliminating our continued exposure to a volatile, commodity-based raw materials market in the solar industry. We are extremely proud that we were able to maintain the integrity of these business segments through a substantial market downturn without negatively impacting our liquidity. With the conclusion of these accretive transactions, we have now received significant value for these businesses while simultaneously reducing our common shares outstanding by nearly nine percent.”
Wendeng He Xie Silicon Co., Ltd. and Zibo Baokai Commerce and Trade Co., Ltd. had been involved in the manufacturing and distribution of trichlorosilane, which is a chemical compound used in the production of polysilicon graded for solar fuel cells in photovoltaic panels. Divesting and concluding these business segments lets ForceField Energy leave the globally depressed polysilicone market and turn greater attention to distribution and sales of its LED lighting products, smart electric meters, and modular waste heat conversion units.
For more information about ForceField Energy, visit: www.forcefieldenergy.com
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