RGS Energy acquiring solar firm in Hawaii
Last Updated: 14:24 March 27, 2014
The purchase helps RGS expand its footprint into a Hawaiian market where the nation's highest electricity rates make solar power a particularly attractive option.
Louisville-based RGS designs, installs and manages solar projects for both commercial and residential customers. Sunetric does the same on each of Hawaii's major islands.
"The extremely high cost of utility power in Hawaii has made it one of the most attractive markets for solar systems in the U.S., and this has led to the highest penetration of solar systems in the country," RGS's chief executive Kam Mofid said in a press release. "As a result, Hawaii leads the industry in important areas such as grid integration and is key to the evolution of solar combined with energy storage. We are eager to participate in this vibrant market and benefit from significant opportunities ahead."
Sunetric will keep its management and branding and become a division of RGS Energy. The acquisition adds about 90 employees to RGS Energy's roster.
Founded in 2004, Sunetric had 2013 revenue of more than $38 million. RGS has agreed to pay $7 million in cash and $9 million in unregistered class A common stock. RGS could also pay up to $3 million in earn-out payments, based on Sunetric's future earnings.
RGS said the deal will close in the second quarter of this year.
RGS, which has 17 offices across the West and Northeast, earlier this week posted an $11.3 million net loss for fiscal year 2013 despite annual revenue increasing 9 percent to $101.3 million. RGS shares dipped sharply to $3.45 Thursday morning but rebounded and were trading at $3.78 by mid-afternoon, down 11 cents from the previous day's close.
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