Carraro leaves the world of photovoltaics: control of Elettronica Santerno has been passed over to Enertronica

Milan, 3 November 2016 - Today in Milan a contract was signed which cedes 51% of the rights to Elettronica Santerno SpA, a Carraro Group company specialising in power electronics, to Enertronica SpA, a company operating in the renewable energy and energy saving sector, responsible for designing and manufacturing electromechanical systems (listed on the Milan Stock Exchange - AIM Italy).

'The release of Santerno from the scope of consolidation of Carraro Group marks the definitive completion of our process of reorganisation and of our decision to refocus our full attention on our core business area. This last step will allow us greater strength to grow in our main markets, by investing primarily in the development of technological solutions for agricultural mechanisation. This will enable us to concentrate on the sectors in which we are seeing significant recovery, particularly in terms of margins, further supported by the consensus of the leading manufacturers of agricultural and construction equipment - comments Enrico Carraro, Chairman of the Group - Parallel to this, we plan to place renewed emphasis on Carraro's R&D activities, having gained considerable internal expertise with regard to mechanics-related electronics, which are of strategic importance in supporting new-generation transmission technologies.'

Elettronica Santerno became part of Carraro Group in 2006, and in just a few years, came to rank among the market leaders in the photovoltaic inverter sector, with the company's turnover growing from 11.6 million euros to more than 140 million. The sudden crisis that hit the sector forced the company to undergo a process of rapid downsizing, reducing the number of individuals employed from 250 in 2010 to 124 today, in parallel with the sharp decline in volumes which led to a drop in turnover, to 35 million euros. In recent years, the company's results have impacted the Group's consolidated turnover, making less evident the positive outcome reached by Drive Tech and Agritalia.

In choosing Enertronica, Carraro Group has sought to trigger a process that could restore growth to the company, which still boasts advanced technological solutions that are favoured by an international client base.

Details of the deal

The investment agreement signed today will see Enertronica SpA acquiring 51% of Elettronica Santerno, through the subscription of a capital increase in cash, totalling 2.25 million euros. This capital increase will be exclusively dedicated to the revival of the company and to investments in R & D.

Enertronica SpA will also be given the option of increasing its stake in Elettronica Santerno by an additional 9% through the subscription of a further tranche of capital increase (totalling 1 million euros) by 31 December 2018.

In addition to the governance of Santerno, the agreement also stipulates the terms and conditions for the exit of Carraro from the company after an initial 24-month 'lock-up' period, designed to ensure the stability of Elettronica Santerno and the implementation of the Business Plan drawn up between the parties.

The contract is expected to become effective as of 15 December 2016.

Carraro SpA was supported by LMS as legal advisor and by Ethica Corporate Finance as financial advisor.