California's $22 billion electricity crisis is giving microturbine-maker Capstone, a Fletcher Energy associate, some high-voltage attention, with strong forward orders and an improving share price.
Many Californian companies are now rethinking their energy strategies and looking at alternatives to the power grid, such as Capstone's tiny power generators.
Fletcher Energy holds about
9 per cent of Capstone, involving 7.3 million shares worth about $680 million.
As part of the planned sale of Fletcher Energy, five million Capstone shares will be distributed to Fletcher Energy shareholders on a one-for-70 basis.
The balance of the Capstone holding is expected to be sold for cash, with the money going to newly formed Rubicon.
Capstone shares have rallied well from a low of about $US18 ($40.45) a share to a close on Friday of $US41 a share, driven mainly by the California power crisis. The rise has helped to boost Fletcher Energy to more than $9 a share.
The Capstone rally was driven mainly by interest in the company's microturbines as a result of the crisis, and the Association of California Water Agencies ordered Capstone turbines last week to ensure water supplies.
Capstone is also aiming sales at potential users such as nursing homes, hotels and factories. The microturbines are also being used in hybrid electric buses.
The crisis has meant rolling blackouts in California, the biggest economic powerhouse in the United States.
Capstone is still in the early stages of production, but it has made about 1500 units and has about 1000 more on its order books.
- NZPA
