Acta's €8.8 million contract with SPF Energy; joint venture with Fedi
Acta, the provider of clean energy products and environmental catalysts, is delighted to announce that the Company has signed a Preliminary Contract with SPF Energy S.p.A. (“SPF”) for the installation of large-scale photovoltaic parks in Italy. SPF is a specialist renewable energy investment fund created and managed by Sopaf S.p.A., an independent Italian investment bank listed on the Milan Stock Exchange. The installations will be carried out through a joint venture partnership with Fedi Impianti S.r.l. (“Fedi Impianti”), one of Italy’s largest and most highly reputed specialist PV installation companies.
The Preliminary Contract agrees to the development, installation and sale to SPF of large scale photovoltaic parks within Italy during 2010. The total contract value is estimated to be in the region of €50 million, subject to the joint venture being able to secure and deliver the installed capacity requested by SPF. The first phase of this contract, incorporating three installation projects, has been approved subject to final contracts with an aggregate value of €8.8 million, and installation is expected to commence within the next two months.
Additional projects will be added under the terms of the Preliminary Contract as they complete their authorisation procedures and due diligence requirements over the coming months. The project duration of each installation is approximately four months from the commencement of building work.
In order to deliver these projects, Acta has formed a 50%-50% joint venture company with Fedi Impianti, which will operate under the name of “SolGen”. Acta will contribute commercial management, technical consultancy and short term working capital, together with financial and administrative control of the new operations, while Fedi Impianti will be responsible for managing the installation projects and the operational aspects of the joint venture’s activities. 50% of the revenues, costs and profits generated by the joint venture will be recognised simultaneously by Acta.
Paolo Bert, Chief Executive, commented: “During 2009 we have pursued partnerships and opportunities within the Italian photovoltaic installation sector, and we are delighted that these efforts have now culminated in our joint venture with Fedi Impianti and a major photovoltaic installation contract with SPF.
“This area of our business is strategic to us for two key reasons. Firstly, it is highly complementary with our hydrogen generator technology which, for a low-cost electrolyser with no noble metals, is unique in being able to produce compressed hydrogen from intermittent renewable power sources such as photovoltaics. By incorporating the ability to offer photovoltaic panel installations, we can therefore complete the renewable energy value chain from power generation, through energy conversion and storage (in the form of hydrogen), to stationary, mobile or portable fuel cell products and applications.
“The second strategic benefit of the joint venture is that by entering the fast-growing Italian PV installation market we will start generating significant revenues within the short term. We have sought to minimise operational risks on these projects through our choice of partners with specialist technical, legal and project support experience. The cash exposure on the programme will remain well within our financing capabilities.
“2010 will be a year of great activity in the Italian PV market, where high feed-in tariff rates have combined with low component costs and a high availability of prime sites to create an ideal investment environment. We will continue to grow this activity in 2011 and beyond, and we believe that our rapidly growing product revenues, together with the funds generated from the PV installation programme, will be sufficient to carry the Company through to profitability in the short to medium term without the need for further external funding.”