Xantrex in talks to be acquired
Wednesday, July 23rd, 2008Xantrex shares shot up 23 per cent this morning — reaching their highest point since 2004, the year it went public — after the company put out a vague press release announcing “it is in exclusive negotiations with respect to the sale of the company.” It warned that the negotiations might not be successful.
This isn’t surprising. Xantrex was always a success story that investors didn’t fully appreciate. The company, after going through some rough times in 2005 and 2006, has been on fire selling its power electronics and inverter products to the solar and wind sectors. Just recently it inked a $5 million inverter deal with SunEdison, though this is just the latest in a string of sales deals with the who’s who of the renewable-energy sector. One financial analyst I spoke with said he wouldn’t be surprised if the likely buyer is Siemens or Schneider Electric, as clearly some of these bigger companies are looking to gain a stronger foothold in the booming renewable energy sector. After all, when you’ve got calls for 100 per cent renewable and clean energy on the U.S. grid (Al Gore) or 20 per cent wind power in the U.S. (T. Boone Pickens), the possible outlook for sales is quite impressive.
Looking at the stock, it could turn out to be a $400 million-plus acquisition — not a big sale by U.S. standards, but given that Xantrex is probably one of the largest and most successful cleantech companies in Canada to date, this is a big deal here. I have to say, I’ll be sad to see the reins handed over to a foreign company. Xantrex is truly an all-Canadian cleantech success story.
Tyler Hamilton is editor-in-chief of Corporate Knights magazine and a business columnist for the Toronto Star, Canada's largest daily newspaper. In addition to this Clean Break blog, Tyler writes a weekly column of the same name that discusses trends, happenings and innovators in the clean technology and green energy market. This blog is a personal project started in April 2005. It is not an official blog of the newspaper.
