iQ Power AG / Key word(s): Strategic Company Decision/Miscellaneous
16.03.2012 17:29
Dissemination of an Ad hoc announcement according to § 15 WpHG, transmitted
by DGAP - a company of EquityStory AG.
The issuer is solely responsible for the content of this announcement.
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New strategic focusing of iQ Power AG
- Increased cooperation with Korean battery manufacturer to enhance
supply chain management and delivery reliability
- Search for a strategic partner for a majority stake in European
facility
- Focus on the licensing business
- New focusing will require adjustment to the convertible bond issued
Zug/Switzerland, 16 March 2012 - the iQ Power AG (ISIN: CH0020609688, WKN:
A0DQVL, Symbol: IQPB), developer and marketer of eco-friendly and
technologically advanced starter batteries for motor vehicles, announced
today the base for the strategic and structural reorganization and
development of the Group.
The management and the board of directors of iQ Power AG have agreed on
various measures for a strategic reorientation and strengthening of the iQ
Power business model. The cooperation between the European battery
production facility and the facility of the Korean joint venture partner
will be intensified in the future. This enables an optimization of the
supply chain management and will lead to faster and more flexible
deliveries due to scale and cost advantages. Another essential part of the
action taken is a significant streamlining of the Group structure, which
provides for a reduced role of iQ Power AG at the production units and
distribution company in Europe. The research and development department
will be reduced to key positions in order to maintain the company's
intellectual property and the development of future technologies. This
means that the overhead costs of the company will be significantly reduced.
Although the European business is developing satisfactorily, the iQ Power
AG has decided to focus almost exclusively on the promotion of the
licensing business. iQ Power will seek to maintain a minority share in the
European operations. The minority stake is similar to holdings with the
other licensees and helps to influence customer service, delivery
reliability and quality,
The drivers behind the new measures are, 1-the significant expansion of
European production capacities can not be realized in the short to medium
term and 2-the inability to take-over the lead battery manufacturing and
recycling plant in Bosnia Herzegovina.
As a battery manufacturer, it is mandatory to achieve a critical sales
volume with an integrated lead recycling to be able to operate profitably.
Accordingly, a strategic partner for a majority stake in the European
business is being looked for, through whom the targeted business growth and
the financial terms are optimally supported. Various partner models are
currently under investigation, such as the participation by a licensee, a
large battery supplier or a management buy-out.
Until a suitable partner is found for a majority stake, the iQ Power AG
will support the European operations fully. A continuous maintenance of the
supply chain for customers and suppliers is ensured.
The restructuring of the iQ Power Group as well as the associated
concentration on the license model paves the way to profitability with a
lower sales volume in a short to medium term. Also, the financing of the iQ
Power AG is put on a solid basis by continuous royalties. The forecasts of
the royalties of the Korean licensee amount to over 50,000 EUR per month
from the middle of 2012 with a significantly increasing trend up to EUR
200,000 per month by the end of the year. Due to delays, the first license
revenue from North America is expected for mid 2012. The operation in
Europe will continue to be a further source of royalty income. Other
licensee agreements are currently in negotiation.
Influencing the decision is the fact that the European business is now on a
stronger basis and requires less support from the iQ Power AG, because the
joint venture plant in Gwangju, Korea has the possibility to deliver large
quantities of DIN European sized batteries to European customers in
collaboration with the European plant.
Even more important for the financial future of the AG, is the fact that
the success of the licensees abroad is now largely independent of the
commercial success in Europe.
By opting for a strategic realignment of the company, the iQ Power AG keeps
the possibility of a merger or participation by interested parties open. In
this regard, the basis for such negotiations will mainly be the licensing
business.
Finally, the iQ Power AG announces changes in the still ongoing convertible
bond. Due to the lack of acquisition of the battery manufacturing and
recycling plant in Bosnia Herzegovina, the equity amount of the factory as
well as the shares in Asia will no longer be available. As a compensation
for the loss of this security, the conversion price of EUR 0.048 is reduced
to EUR 0.036, whereby the total volume of the convertible bond is reduced
to a maximum of EUR 4.2 million (previously: EUR 5.6 million). Signatories
of the convertible bonds that have been drawn at a conversion price of EUR
0.048 will receive an adjusted offer. Further details on the convertible
bond will be published shortly. The funds are used to fund working capital
and to improve the balance sheet position.
The Board
About iQ POWER
iQ Power AG is a developer and supplier of innovative starter batteries for
motor vehicles. The products are technologically advanced, deliver greater
efficiency, and are environmentally sound and lighter in weight. The
company's many achievements include the development of the world's first
software-controlled smart car battery. Industrial batteries and system
solutions for electrical energy management in vehicles help round out its
operational portfolio.
The company's operational element is iQ Power GmbH in Chemnitz (Germany),
which is a wholly owned subsidiary of iQ Power AG. Headquartered in Zug
(Switzerland), iQ Power AG is a publicly listed stock corporation whose
shares are traded on the regulated market (General Standard segment) of the
Frankfurt Stock Exchange, over the counter on the securities exchanges in
Berlin, Düsseldorf, Munich and Stuttgart, as well as on Xetra (ISIN:
CH0020609688, WKN: A0DQVL, IQPB).
Contact:
Company Contact:
iQ Power AG
Metallstrasse 9
6304 Zug
Schweiz
Tel.: +41(0) 41 768 03 63
Fax: +41(0) 41 768 03 68
info@iqpower.com
www.iqpower.com
Investor Relations Contact:
GFEI Aktiengesellschaft
Am Hauptbahnhof 6
60329 Frankfurt am Main
Tel.: +49 (0)69 - 74 30 37 00
Fax: +49 (0)69 - 74 30 37 22
iQPower@gfei.de
www.gfei.de
16.03.2012 DGAP's Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Media archive at www.dgap-medientreff.de and www.dgap.de
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Language: English
Company: iQ Power AG
Metallstrasse 9
6304 Zug
Switzerland
Phone: +41 41 7680360
Fax: +41 41 768 03 68
E-mail: investor-relations@iqpower.com
Internet: www.iqpower.com
ISIN: CH0020609688
WKN: A0DQVL
Listed: Regulierter Markt in Frankfurt (General Standard);
Freiverkehr in Berlin, Düsseldorf, München, Stuttgart
End of Announcement DGAP News-Service
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DGAP-Adhoc: New strategic focusing of iQ Power AG
| Source: EQS Group AG