Etrion Corporation

Etrion Corporation

April 12, 2010 08:29 ET

Etrion Signs Agreement to Acquire Deutsche Bank Solar Assets in Italy

TORONTO, ONTARIO--(Marketwire - April 12, 2010) - Etrion Corporation ("Etrion" or the "Company") (TSX:ETX), a Canadian energy company, has signed a definitive sale and purchase agreement to acquire a portfolio of Deutsche Bank solar assets in Italy for 10.3 million Euros plus a contingent deferred payment of 1.5 million Euros.

The Deutsche Bank assets being acquired include 6 megawatts ("MW") of operating assets and 10 MW of permitted projects ready for construction in the Puglia region plus a pipeline of more than 150 MW in various stages of permitting.

The operating assets consist of 6 MW of ground-based solar photovoltaic ("PV") plants, producing over 10,250 kilowatt hours ("kWh") of electricity and approximately 4 million Euros of cash flow (EBITDA) per year. These plants benefit from the 2009 feed-in-tariff of 0.353 Euros per kWh plus a spot rate of approximately 0.08 Euros per kWh. The Italian feed-in-tariff is a premium purchase price for renewable electricity that is guaranteed by the Italian government for 20 years. The operating plants also benefit from an existing facility agreement with Societe Generale and Dexia for up to 45 million Euros available on the basis of 90:10 debt-to-equity, of which 28 million Euros have been drawn to date.

Marco Northland, the Company's CEO, commented, "This acquisition represents an important leap forward for Etrion. We are acquiring a combination of operating assets with immediate revenue, projects for construction in 2010, a pipeline for 2011 and relationships with highly qualified local developers. We look forward to building out the Italian pipeline that Deutsche Bank developed over several years."

The acquisition of the Deutsche Bank assets is scheduled to close by April 30, 2010, and is subject to typical closing conditions.

The Company intends to fund the acquisition through a combination of cash on hand and a bridge loan from its major shareholder, Lundin Petroleum. The bridge loan carries interest at LIBOR plus 3%.

About the Company

Etrion Corporation is a Canadian energy company based in Geneva, Switzerland and listed on the Toronto Stock Exchange (ticker symbol "ETX"). The Company is focused on building, owning and operating global electrical power plants based on renewable sources of energy, including solar photovoltaic, solar thermal and wind.

The Company is owned 45% by Lundin Petroleum, a Swedish independent oil and gas
company traded on the NASDAQ OMX Stockholm exchange (ticker symbol "LUPE"), and approximately 13% by the Lundin family through various trusts.

Forward-Looking Information:

This press release contains certain "forward-looking information". All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements relating to the acquisition of solar assets and the Lundin Petroleum bridge loan) constitute forward-looking information. This forward-looking information reflects the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking information is subject to a number of significant risks and uncertainties and other factors that may cause the actual results of the Company to differ materially from those discussed in the forward-looking information, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the Company. Factors that could cause actual results or events to differ materially from current expectations include, but are not limited to, the failure to close the acquisition and to begin construction on the Italian projects in a timely manner and the failure to begin selling electricity in a timely manner.

Any forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein.

Contact Information

  • Etrion Corporation
    Garrett Soden
    Chief Financial Officer
    +41 (22) 715 20 90
    +41 (22) 715 20 99 (FAX)