UTC to invest £126.5m in Clipper Windpower

15th December 2009

US industrial company United Technologies Corporation (UTC) has agreed to invest £126.5m into wind energy developer Clipper Windpower.

UTC has agreed to subscribe for more than 84 million shares in the company at £1.50 per share, which represents approximately 39.3 per cent of Clipper’s enlarged issued share capital. It has also confirmed it intends to launch a partial cash offer to purchase more than a further 21 million Clipper shares from existing shareholders at £1.80 per share, which would increase its ownership to approximately 49.5 per cent.

The issue of shares is projected to take place in January 2010 and certain shareholders have entered into a call option with UTC so that If UTC receives tenders for fewer shares than the target number, they will sell sufficient shares to ensure UTC a 49.5 per cent ownership in the company.

Clipper said it expects the subscription to strengthen its balance sheet and facilitate financing of its projects, and prime it for growth in the US, and offshore wind markets.

Clipper’s president and CEO Douglas Pertz said, ‘This is a transformational transaction for Clipper, bringing substantial capital from a strategic investor who is one of the world’s leading industrial technology companies.

‘Our relationship with UTC will enable Clipper to access UTC’s support and expertise in areas of manufacturing, product quality and other industrial processes, while providing Clipper with equity financing to deliver our longer-term strategic goals. Following this transaction, we believe there is a tremendous opportunity for Clipper to grow its market share and take its world-class technology to new markets,’ he added.

NYSE-listed UTC, which provides technology, products and services to the building systems and aerospace industries, has a market capitalization of around $64bn, with revenues of $59.8bn reported in 2008. Its principal operating units include Otis, Carrier, UTC Fire & Security, Pratt & Whitney, Hamilton Sundstrand and Sikorsky.

Clipper says recent global economic, market and credit conditions have resulted in significant difficulties for the company, which has incurred remediation costs of over $330m since 2007.

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