Friday, February 20, 2009

Beacon Power pulls in stock deal worth up to $18M

By Mass High Tech staff

As it prepares to ramp up production, Beacon Power Corp. reports that it has entered into a private stock sale deal with Seaside 88 LP that will bring $18 million to the Tyngsborough-based power technology company.

Seaside has agreed to buy $1 million of Beacon Power (Nasdaq: BCON) common stock from the company each month for up to 18 months, beginning today.

According to Bill Capp, Beacon Power president and CEO, this deal will give the company a portion of the funds it needs to manufacture its flywheel-based power grid regulation systems and the containers to house them.

The funding deal is split into three six-month tranches, and Beacon says it is committed to only the first six-month tranche but has the option to extend the agreement through each of the remaining two tranches.

Earlier this month, Beacon Power landed a deal with the U.S. Naval Sea Systems Command, potentially worth up to $3 million, to evaluate a flywheel energy storage system for naval surface combatants.

The contract calls for system and component development of NAVSEA’s Integrated Power Systems (IPS) and its energy storage needs for ships; identifying of potential flywheel use; and production of  a final design concept outlining flywheel design models. The work itself should generate about $900,000 total for Beacon Power, company officials said, while the additional work phases could net another $2.1 million.

For fiscal 2007 Beacon Power reported a loss of $12.9 million on revenue of $1.4 million.