First Solar to sell Mesa, Arizona facility

theflyonthewall.com

On October 3, First Solar entered into an agreement to sell the company’s facility in Mesa, Arizona. The facility consists of land, a 1.3M square foot building and certain fixtures and improvements, including a 3.3 MW AC rooftop PV array and a small ground-mounted PV test array. The facility currently houses the company's Operations & Maintenance capabilities as well as certain equipment and inventory. The facility was originally designed to house a cadmium telluride photovoltaic module manufacturing factory; however, as previously announced, the company has not commissioned manufacturing at the facility. The Mesa Sale is expected to close in the fourth quarter. Upon closing, the Mesa Sale will provide additional liquidity to the company in the form of cash sale proceeds, net of costs to sell, in excess of $100M, and is expected to result in a net reduction in annual operating expenses (including both depreciation expense and cash expenditures) of approximately $10M. The Mesa Sale is expected to result in a loss against book value of between $55M-$60M. Such loss is to be incurred in the third quarter. In addition, approximately $5M-$10M of costs associated with relocation of personnel, equipment and inventory are to be incurred primarily throughout the remainder of 2013. In connection with the Mesa Sale, the First Solar’s Network Operations Center and approximately 80 O&M and other employees will be relocated from the Mesa facility to the company’s world headquarters in Tempe, Arizona. Equipment, machinery and stored inventory currently located at the Mesa facility will be relocated to other warehouse facilities to be determined. The manufacturing equipment stored at the Mesa facility remains available to be deployed in other locations to the extent First Solar determines in the future that market dynamics support additional module manufacturing by First Solar.

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