Advanced Energy shutting down its solar-inverter business

FORT COLLINS — Advanced Energy Industries Inc. (Nasdaq: AEIS) announced Monday that it will close its solar-inverter business, laying off an undisclosed number workers who operated under AE Solar Energy Inc., AEI Power GmbH and their subsidiaries.

Yuval Wasserman, president and chief executive of Fort Collins-based Advanced Energy, said in a prepared statement that during the past six months the company has explored alternatives for its sagging solar-inverter business, including a potential sale, joint venture, partnership, spin-off, licensing and other alternatives.  The solar-inventor business primarily focused on commercial and utility-scale solar projects and installations. In April, it had landed a deal for 325 megawatts of solar projects from San Diego-based Swinerton Renewable Energy.

The company’s precision-power business falls under its thin-film division, which had a strong 2014 and first quarter in 2015. The thin-films unit principally serves original equipment manufacturers and customers in the semiconductor, flat-panel display, solar panel and other industrial capital-equipment markets.

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The company registered power-precision sales of $105 million for its first quarter that ended March 31, a 39 percent increase compared with the same period a year ago. For the same period, its solar-invertor sales declined 39 percent, from 58 million in 2014 to $35.3 million this year.

“After an extensive strategic process over the last six months, we concluded that focusing solely on our precision-power business, and exiting the solar inverter business aligns with our long-term goal of maximizing value for our shareholders,” Wasserman said in a prepared statement.

The company expects to record a pre-tax charge of approximately $260 million to $290 million related to closing the solar inverter business, the majority of which will be recorded in the second quarter of this year.

Approximately $150 million relates to the impairment of goodwill and intangibles, $45 million to $75 million to the write-down of inventory, fixed and other assets, $15 million for employee termination cost, $10 million for tax-valuation allowances and the remaining $40 million for other costs to exit the business, according to a filing with the Securities and Exchange Commission.

The company said it will continue to support customers of AE Solar Energy Inc., AEI Power GmbH and their subsidiaries during the wind down by completing installations in progress and fulfilling customer purchase orders on hand.