Northern Power sold to Conn. company


Burlington Free Press, May 23, 2003

By Sue Robinson
Free Press Staff Writer

A Wallingford, Conn., company will buy Northern Power Systems Inc. of Waitsfield in a deal worth $27.5 million in stock and cash, Northern Power President and CEO Jito Coleman said Thursday.

Northern Power will become a wholly owned subsidiary of a new corporation created by the buyer, Proton Energy Systems. Proton will also become a subsidiary of the new holding company.

All of Northern Power's 100 jobs will stay in Vermont , and the company plans to finish the $4 million expansion it began two years ago, Coleman said. The deal also included warrants -- the right to buy stock at a set price -- for Proton shares for Northern Power employees.

"The key thing is this is good news for Vermont and our guys," he said.

Proton President and CEO Chip Schroeder said his company agreed to keep Northern Power in Vermont for at least three years as part of the deal, and emphasized he had no intention of ever moving the company.

Northern Power, a private company, develops power systems for companies and nations using a combination of energy sources. Coleman declined to give current financial data, but in 2001 the company had $15 million in revenues, a 400 percent increase over 2000.

Northern Power has used Proton's hydrogen machines -- which create hydrogen from water -- to make its power generators, Coleman said.

"It happened that their interests coincided with ours," Coleman said of the buyer.

Coleman said Northern Power, which often has to borrow money to build its products, was interested in joining up with Proton because the public company has more access to cash.

Proton reported $4.7 million in revenue in 2002 and an operating loss of $13.5 million. Coleman said the loss resulted from research and development investments, and he believed the 6-year-old company would turn around soon. Proton's stock closed at $3.24 a share Thursday.
Contact Sue Robinson at 660-1852 or srobinso@bfp.burlingtonfreepres .comNorthern Power
Systems

HEADQUARTERS: Waits- field
PRESIDENT/CEO: Jito Coleman
EMPLOYEES: 100
PRODUCT: Makes power generators running on renewable energy and fossil fuels
REVENUES: $15 million in 2001
IN THE NEWS: Proton Energy Systems of Wallingford, Conn., agreed to buy Northern Power in a deal worth $27.5 million in cash and stock.