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Energy

First Solar Sees Less Dilution For Acquisition (FSLR)

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By Douglas A. McIntyre Updated Published
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First Solar, Inc. (NASDAQ: FSLR) has completed its acquisition of OptiSolar’s photovoltaic project pipeline.  The company said that it expects to construct the solar power plants developed under the pipeline over the next several years.  It also still plans to sell them to regulated utilities, diversified energy companies and other independent power producers. What is interesting is that the deal looks cheaper than when it was first announced, at least as far as shareholders and their expected dilution are concerned.

First Solar noted that the core development team responsible for assembling and executing on the solar project pipeline has also joined the First Solar development team.  OptiSolar’s project development business was acquired in an all-stock transaction valued at approximately $400 million, so First Solar is issuing approximately 3 million shares of common stock for the deal.  The company noted that this represents an estimated dilution of 3.5% to common stock, which is actually less than the 5% expected dilution that was first announced due to the price appreciation of First Solar shares.

First Solar is one of our energy stocks which we think could double by the end of next year as the recovery comes to the economy.  Its shares were at $103.97 and its market cap was listed as about $8.5 billion when this OptiSolar deal was announced.  Even with a near 4% drop today, shares are at $132.50 and the market cap is about $10.8 billion.

JON C. OGG
April 3, 2009

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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