Westport Innovations Inc. (TSX:WPT) (NASDAQ:WPRT), the global leader in natural gas engines, today announced that it has acquired BAF Technologies, Inc. (BAF) and its subsidiary, ServoTech Engineering, Inc. (ServoTech), subsidiaries of Clean Energy Fuels Corp. (NASDAQ:CLNE) for $25 million in Westport stock. Westport and Clean Energy also announced a $5 million joint marketing and sales program.
Westport believes that the amalgamation will create the largest product portfolio and largest market presence in the North American light duty natural gas vehicle (NGV) space. Specifically, Westport secures its position as Ford’s largest partner under the Qualified Vehicle Modifier (QVM) program with over 10 products and approximately 150 Ford authorized dealerships. The transaction allows both Westport and Clean Energy to focus on the significant growth opportunities as natural gas emerges as a global fuel for transportation.
“We welcome the BAF and ServoTech teams to Westport,” said Ian Scott, Executive Vice President of Westport. “BAF has established a strong portfolio of natural gas vehicle products and customers over the past decade. With natural gas increasingly seen as a major transportation fuel around the world, we believe the combination of this new teams’ market experience and Westport’s technologies, scalable manufacturing processes and quality control systems will help create the type of products needed to deliver an OEM-quality vehicle experience to our customers.”
BAF supports clients with vehicle conversions through the Ford QVM program and aftermarket conversion products, alternative fuel systems, application engineering, service and warranty support. ServoTech offers a total engineering solution from initial concept phase to prototype hardware and final prove-out, including design and development of electronic products, software development, automotive exhaust simulation and testing, spark-ignition gasoline and diesel emissions technology, and offers technical training and education in a variety of subject areas.Currently, Westport exclusively installs the natural gas Westport WiNG™ Power System on the Ford F-250 through F-550 series at its assembly center in Louisville, KY. This acquisition increases Westport’s product range with the Ford line to include transit, cargo shuttle and taxi vehicles and dedicated natural gas vehicles for markets such as California. BAF has been producing a broad list of natural gas vehicle conversions for more than a decade and recently produced its 20,000 th compressed natural gas (CNG) vehicle conversion. Westport will continue to install the Westport WiNG Power System and the increased volume of orders expected through BAF will create economies of scale, and the BAF network will allow more flexibility in producing speciality configurations. Transaction highlights include:
- $25 million payable in shares of Westport’s common stock on closing at a price of $30.62 based on a 10 day volume weighted average, subject to adjustments
- Trailing 12 months revenue of $20.9 million to April 30, 2013
- Long list of Ford QVM products including but not limited to:
- Ford Transit Connect (EPA approved, CARB pending)
- Ford E-250/350 (EPA & CARB approved)
- Ford E-450/550 (EPA & CARB approved)
- Ford F-250/350 (EPA & CARB approved)
- Ford F-450/550/650 (EPA & CARB approved)
- Ford F-59 (EPA & CARB approved)
- Unique capabilities, deep industry experience and knowledge
- As a qualified calibration modifier (QCM), ServoTech has preferential access to Ford engine controls. ServoTech also brings a substantial technology portfolio around diesel emissions control, diesel dual-fuel operation and other alternative fuels capabilities.
- ServoTech engineering center is in close proximity to Westport’s Detroit office