SARASOTA, Fla., March 20, 2013 /PRNewswire/ -- Sarasota, Florida-based Evolucia Inc. (OTCBB & OTCQB: ILED) and Warsaw, Poland-based SETE Sp. z o.o. ("SETE") announce today that they have finalized a joint venture whereby the companies will work together to manufacture, market and sell Evolucia's proprietary energy-efficient LED lighting products throughout Europe under the Evolucia brand.
The joint venture calls for the payment of $11 million (8.5 million Euros) to Evolucia by August 31, 2013 for the manufacture and distribution rights to the European markets. Under the joint venture agreement, a new entity called Evolucia Europe Sp. z o.o. will be created, with Evolucia Inc. holding a 51% ownership share and SETE holding the remaining 49% ownership. The joint venture agreement provides exclusive manufacturing rights to Evolucia Europe for the European markets. Production of the Evolucia LED Aimed Optics™ fixtures is expected to begin in 2013 at the manufacturing facility in Radom, Poland.
"This joint venture is a testament to the hard work and vision that is shared between our two organizations and the importance of delivering world class lighting solutions to our strategically focused markets around the world. This agreement signals the start of an international expansion for our company. Solid State Lighting will continue to develop for years to come and our experience is that global customers and investors are looking at key enablers in the market, with innovative design concepts that change the course of challenging applications, like our proprietary Aimed Optics™ technology," said Mel Interiano, Evolucia Chief Executive Officer. "This critical $11 million (8.5 million Euros) investment allows us to leverage key strengths in order to build a world class global lighting organization capable of supporting what we believe will be significant revenue growth in the short term with the ability to expand over the long term."
"This licensing fee will add $9.9 million (7.7 million Euros) to incremental free cash flow after associated expenses in 2013 (the equivalent effect of nearly $45 million-34.8 million Euros in revenues) and represents step one of a broader, multi-step plan we are implementing this year as part of our financial roadmap to strengthen the company's balance sheet," said Charles Rockwood, Executive Vice President and Chief Financial Officer, Evolucia Inc.
Evolucia Europe will be headquartered in Warsaw, Poland and will report to the U.S.-based Evolucia Inc. Arkadiusz Pietrzykowski has been named president of Evolucia Europe and will report to Mel Interiano, CEO of Evolucia Inc. Municipal and public sector lighting accounts for 75 million points of light across Europe. The European Union has embarked on an effort to reduce energy consumption and carbon emissions by 2024. High Pressure Sodium (HPS) used throughout Europe for street, roadway and parking lot lighting has been targeted for replacement opening up this large market to Evolucia's Aimed Optics™ LED Cobra Head roadway lighting solutions. Poland currently accounts for 5% of the total market. The Evolucia LED Cobra Head fixture captured two sought after European awards winning the Best Product in the 19th International Fair of Lighting Equipment , LIGHT 2011, and the Leader of Sustainable Development during the 5th Economic Forum "Energy and Environment" in Warsaw in 2011.
"For the time being SETE will subcontract manufacturing in Radom, Poland in order to start production shortly. The manufacturing facility is already up and running and we have begun re-tooling for the European versions of the Evolucia LED lighting portfolio. We had already begun outreach to several cities, towns and private businesses in Europe in anticipation of this agreement and we expect to commence delivery of the highly efficient Evolucia LED products to municipal and recreational customers this year," said Arkadiusz Pietrzykowski, President, Evolucia Europe.
Evolucia street, roadway, area, garage and parking lot lighting provides optimum energy savings, excellent color rendition and long life. In addition, the Evolucia products are designed to optimize product performance with the company's protected Aimed Optics™ photometric design. Evolucia delivers a completely integrated lighting system. By optimizing the photometrics of the lighting fixtures, light is delivered precisely to the area being targeted, with minimal spill and waste. Evolucia LED street lighting delivers 66% energy savings when compared to traditional light sources. Its average 70,000 hour life translates to years without maintenance and up-keep and is backed by Evolucia's leading 10 year warranty program.
"Europe is facing the challenge of delivering massive energy and carbon emissions savings between now and 2024. Infrastructure lighting offers an incredible target of opportunity if countries, provinces, cities and towns leap frog from the commonly used High Pressure Sodium (HPS) lighting to LED (light emitting diode) lighting solutions. Our new joint venture with SETE positions us to take advantage of this dramatic growth in the European lighting markets," added Interiano.
About Evolucia Inc.
Evolucia Inc. is an industry pioneer in the design, engineering, manufacture and distribution of high performance LED lighting systems to the global lighting markets. Evolucia received the United States Department of Energy's highest award for lighting within the LED category, and has installed thousands of its fixtures at military bases, universities, municipalities, and large commercial entities. Evolucia's LED lighting products are sold under the brand, Evolucia Lighting (www.evolucialighting.com).
All Evolucia products offer highly energy efficient, durable, commercial-grade LED lighting for both indoor and outdoor applications. The company's award winning cobra head and shoe box fixtures employ Evolucia's proprietary Aimed Optics™ technology, which increases light levels and visibility by strategically directing light to the target area. Evolucia fixtures require 50%-80% less energy than traditional lighting, and last for approximately 12 years without maintenance.
SETE Sp. z o.o., headquartered in Warsaw, Poland is a private international investor group organized for the purpose of funding and supporting the manufacture and distribution LED lighting solutions into European LED lighting market which is projected to reach $10 billion (7.7 billion Euros) by 2015.
Some of the statements made by Evolucia in this press release are forward-looking in nature. Actual results may differ materially from those projected in forward-looking statements. Evolucia believes that its primary risk factors include, but are not limited to: development and maintenance of strategic acquisitions; domestic and international acceptance of our product lines; defending our intellectual property and proprietary rights; development of new products and services that meet customer demands and generate acceptable margins; successfully completing commercial testing of new technologies and systems to support new products and services; and attracting and retaining qualified management and other personnel. Additional information concerning these and other important factors can be found within Evolucia's filings with the Securities and Exchange Commission. Statements in this press release should be evaluated in light of these important factors.
SOURCE Evolucia Inc.