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Jax Daily Record Tuesday, May 17, 201612:00 PM EST

Saft agrees to $1.1B buyout deal; company expects no impact on Jacksonville plant

by: Mark Basch Contributing Writer

Saft Groupe S.A., the Paris-based battery maker that operates a state-of-the-art plant on Jacksonville’s Westside, agreed to a $1.1 billion buyout last week.

Total S.A., a French energy company, is buying Saft to expand its green energy operations.

A Saft spokeswoman in Paris said by email the deal should have no impact on the company’s lithium-ion battery plant in the Cecil Commerce Center, which opened in 2011 and employs almost 300 people.

Total CEO Patrick Pouyanne said in a news release the deal will “enable Saft, its management and employees to benefit from Total’s technical, industrial, commercial and financial support. In addition, this transaction will enable Saft to successfully accelerate its development.”

Total is mainly an oil and gas company but expanded into solar power in 2011 by acquiring SunPower Corp.

“The acquisition of Saft is part of Total’s ambition to accelerate its development in the fields of renewable energy and electricity,” Pouyanne said.

Saft’s Jacksonville plant made headlines in February when President Barack Obama visited to tout the facility as an example of the federal government’s successful investment in clean energy projects.

In addition to city and state incentives, Saft received a $95.5 million grant from the U.S. Department of Energy to build the plant.

However, the plant has struggled financially since opening.

Saft reported its lithium-ion business, which includes a plant in France in addition to the Jacksonville facility, produced a 2015 loss of 21.3 million euros (about $24 million) before interest, taxes, depreciation and amortization.

According to a February New York Times story, during Saft’s conference call with analysts to discuss 2015 results, CEO Ghislain Lescuyer said he was “frustrated” with the financial performance but “not pessimistic about Jacksonville.”

He said the Jacksonville plant is not expected to be profitable for several years.

In last week’s news release, Lescuyer said he is “convinced that Total will provide Saft with the required expertise and resources needed for its future development, particularly in terms of technological and commercial capabilities. This transaction will benefit Saft’s clients and employees, who will be joining a major player in the energy space.”

Total is paying 36.50 euros per share (about $41.50) to buy Saft, which the companies said was a 38.3 percent premium to Saft’s stock price before the deal was announced last Monday.

Winthrop selling Fanatics warehouse

Winthrop Realty Trust disclosed in its quarterly report it has entered into a contract to sell its 588,000-square-foot Westside warehouse, leased mostly by Fanatics Inc., for $10.5 million.

The company did not say who the buyer is but said it expects to close the sale in the second quarter, after it signed the contract April 13.

Winthrop is a Boston-based real estate investment company that has been engaged in liquidating its property portfolio for two years.

Its annual report said it had an agreement to sell the Jacksonville warehouse at 5245 Commonwealth Ave. in April 2014, but that deal was never consummated.

Fanatics, the Jacksonville-based sports merchandise company, occupies 561,000 square feet of the building, according to Winthrop’s annual report. That report said Fanatics has 30 months remaining on its lease.

FIS rises after Investor Day

Fidelity National Information Services Inc., or FIS, reached record highs last week after the company provided a positive outlook at an “Investor Day” meeting in New York on Tuesday.

Jacksonville-based FIS, which provides technology services for financial institutions, said it expects adjusted earnings to grow by 13 to 18 percent over the next three years, which would bring earnings per share at $4.70 to $5.10 in 2018.

The average analysts’ forecast for 2018 had been $4.66, according to Thomson Financial.

FIS’ stock rose as much as $2.47 over two days to a record high $74.19 on Wednesday after the presentation.

Sterne Agee/CRT analyst Moshe Katri upgraded his rating on FIS from “neutral” to “buy” and raised his price target for the stock from $70 to $85 after the meeting.

“We believe since last year, management has essentially been streamlining/restructuring the operation by specifically reducing reliance on ‘people-intensive’ IT projects which, including consulting practice Capco, accounted for as much as 13 percent of 2015’s revenue base,” Katri said in his research report.

“We believe this transformation will make FIS’ model more recurring in nature, while helping to drive EBITDA (earnings before interest, taxes, depreciation and amortization) margin trends,” he said.

Jeffries analyst Ramsey El-Assal actually raised his rating on FIS from “hold” to “buy” Monday, before the meeting.

“We believe FIS remains undervalued and we have high conviction the company has powered through the growth, margin, and macro headwinds that have held back the stock,” he said in a research note.

El-Assal raised his price target for FIS from $72 to $84.

NAC Global announces major acquisition

NAC Global Technologies Inc., a small public company with its headquarters office in Jacksonville, announced an acquisition that would grow the company considerably.

NAC said it agreed to buy Swiss Heights Engineering S.A., a Switzerland-based company with interests in the energy industry.

NAC makes harmonic gearing technology, which is used in the automation, robotics and defense industries, and reported revenue of just $574,564 in the first nine months of 2015.

However, it said with the acquisition, it projects 2016 revenue of more than $30 million.

The company has not filed its 2015 year-end report. It reported a net loss of $962,301, or 4 cents a share, in the first nine months of last year.

Most of NAC’s operations are done at a manufacturing and warehouse facility in Port Jervis, N.Y.

Swiss Heights Engineering owns a company called Bellelli Engineering that operates in six countries, supplying equipment for the oil and gas industry, NAC said.

“A key component of our growth strategy has been to swiftly establish a multimillion-dollar revenue base, and to expand in the energy markets, specifically in process automation controls,” NAC CEO Vincent Genovese said in a news release.

NAC did not announce the value of the deal but said the agreement calls for Swiss Heights Engineering shareholders to end up with 95.75 percent of the combined company.

Genovese currently owns 45.4 percent of NAC’s stock, according to Securities and Exchange Commission filings. He will remain CEO of the company after the merger.

IPO costs affect Advanced Disposal

Advanced Disposal Services Inc. reported revenue rose 1 percent in the first quarter to $333.8 million.

However, operating income dropped 45.8 percent to $13 million, mainly because of expenses related to its attempted initial public offering, the company said in an SEC filing.

After interest expenses, Advanced Disposal had a net loss of $14.3 million in the quarter.

Advanced Disposal, headquartered in the Nocatee development in St. Johns County, attempted to bring its IPO to the market in February but pulled the stock sale back because of the poor stock market conditions during the winter.

The company has not updated its IPO filings since February.

Dick’s Wings opens two locations

ARC Group Inc., franchisor of the Dick’s Wings & Grill restaurant chain, said it has expanded the chain by opening restaurants in Kingsland, Ga., and Pensacola.

That brings the Dick’s Wings chain to 17 restaurants in Florida and five in Georgia.

The two new restaurants are free-standing buildings that were home to other restaurants. ARC Group said these openings are part of its strategy to convert existing restaurant buildings, which allows it to open new locations quickly.

ARC Group is officially headquartered in Louisiana but its corporate office is in Jacksonville.

Apollo buyout of ADT complete

Funds affiliated with Apollo Global Management LLC have completed their acquisition of security company ADT Corp.

Under the terms of the deal, ADT merged with another security company owned by Apollo, Protection 1, but will continue to operate under the ADT brand with its headquarters in Boca Raton.

Jacksonville has one of ADT’s largest operations centers, employing about 2,000 people.

The buyout came only about three and a half years after ADT became an independent public company. It was spun off from Tyco International Ltd. in October 2012.

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