May 1 2007
American Superconductor Corporation, a leading energy technologies company, announced today that it has completed its previously announced acquisition of Power Quality Systems, Inc. (PQS) in an all-stock transaction valued at approximately $4.0 million, or approximately 1.3 times PQS sales for calendar year 2006, based on AMSC's closing stock price on April 27, 2007. Located in Pennsylvania, PQS offers reactive compensation products known as Static VAR Compensators, or "SVCs,"
based on its proprietary thyristor switch technology. These products enhance the reliability of power transmission and distribution grids and greatly improve the quality of power for manufacturing operations.
PQS has been integrated into AMSC's Power Systems business unit.
"The field-proven thyristor switch technology we obtained in this acquisition will save us time and millions of dollars in development costs for a technology that will enhance our reactive compensation product offerings and increase sales to power grid operators and industrial concerns worldwide," said Greg Yurek, founder and CEO of AMSC. "Combining PQS's proprietary thyristor switch technology with AMSC's proprietary controls technology produces a truly powerful new SVC product offering. We are now quoting our SVCs to power grid operators, and we expect this to lead to new sales this fiscal year while also building backlog for next fiscal year and beyond."
Thyristor switches are the heart of many power electronic-based reactive compensation products, including SVC systems. These systems are used to regulate and stabilize power grid voltage, which increases grid reliability and allows more power to be transmitted over existing power transmission lines. Utilizing the proprietary thyristor switch, AMSC expects to offer improved SVC systems that not only have a lower initial cost, but also lower energy and maintenance costs and a smaller footprint when compared with conventional products.
Power Quality Systems has an installed base of more than 60 standard SVC systems with ratings of up to 28 megaVAR (MVAR) in North American utility grids and industrial sites. AMSC will expand the reach of PQS's standard SVC product line globally while also offering higher level SVCs along with AMSC's D-VAR(R) and PowerModule(TM) product offerings.