Greatcell Solar ("GSL") has provided an update on matters relating to its current financial position. The Company has agreed to sell 50% of its materials production assets to Dr. Yanek Hebting, the current GSL production manager who has served in that role for over ten years.
The deal anticipates a future 100% transfer of the production assets upon the completion of payments totaling AUD $1 million (almost USD $718,000) by 30 September 2019 and additional payments for FY2020 and FY2021 based on future earnings.
The board considers the forecast of future EBITDA as highly speculative and that it has insufficient information on which to make a reliable estimate. However, Greatcell Solar has based its sale price on an estimate that EBITDA for FY2020 will be $150,000 and FY2021 $200,000. This provides an estimate of total consideration of AUD $1.117 million.
The name of the newly formed production entity will retain the Greatcell Solar brand. The materials production business will continue to co-locate with other GSL businesses at Queanbeyan.
Managing Director, Richard Caldwell remarked: “We are very pleased with this outcome. It will free up cash to meet more immediate financial obligations while retaining a preferred supply and use arrangement for critical materials inputs as we focus relentlessly on meeting our commercialization objectives. While the transaction is arm’s length, we intend to remain close and exploit existing synergies and shared services arrangements, in particular.”
Dr Yanek Hebting commented: “This venture is a win-win for both parties. The newly formed production company looks forward to working alongside GSL in its commercialization strategy whilst expanding its own production horizons and capability.”