3W Power sales close; more cost cutting measures necessary this year

By Caroline Salls

Pittsburgh, Aug. 12 – 3W Power SA said the sales of its skytron and group affiliates in Bangalore, India, closed in July in connection with an operational reorganization.

“Both disposals represent milestones in the operational reorganization process of the group as we refocus our scope and efforts on our core businesses and markets,” Jeffrey Casper, chief restructuring officer of 3W Power subsidiary AEG Power Solutions Group, said in a news release.

“The company does not intend to make further major divestments but is now under way to make the difficult transition to tackling the deep rooted inefficiencies in the core businesses which have been underperforming and undermanaged for a long time.”

According to the release, the group has taken serious measures to reduce its global and corporate cost basis but will need to take further measures in the third and fourth quarters.

After layoffs and divestitures, 3W Power said total headcount will be reduced to significantly below 1,000 by the end of the year, compared to 1,521 at year-end 2013.

In addition, the company said the €50 million bond to be issued in an exchange as part of its financial restructuring will be issued on Aug. 26.

3W Power said the change of the conditions of the new €50 million bond to be issued in exchange for an old €100 million bond will lower the interest charges and extend the maturity of the bond to Aug. 29, 2019.

The combination of asset sales, closing of affiliates, reduction in fixed operating expenses and lower interest through restructuring of the group’s financial commitments are all intended to bring the remaining core activities of the group into a sound financial position, the release said.

3W Power is the holding company for AEG Power Solutions, a Zwanenburg, the Netherlands-based provider of power electronics systems and solutions for industrial power supplies and renewable energy applications.

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