Clouds Clearing Over American Superconductor

• Report this Comment On July 01, 2011, at 3:38 PM, siliconhillbilly wrote:

  I went so far as to email the CFO at AMSC and beg him to cancel the Switch Engineering deal. With the major income loss, via Sinovel, cash on hand is critical to keeping the company healthy.

  With a low stock price, the size of a float to finance the acquisition would have been too large for the value received, in my opinion.

  I am very pleased they found a way out with minimum financial pain. My prediction is that the deal will be cancelled at the end of the delay period. Given my feeling on the future potential of "windmill" power, that will be a good thing. I didn't invest in AMSC 20 years ago to own a company dependent on government subsidies to make a profit. Especially on Chinese government subsidies.

• Report this Comment On July 01, 2011, at 4:23 PM, jscilla wrote:

  The fact that amsc put money upfront doesn't mean much since they will owe a termination fee if they

  are not able to obtain financing. According to the agreement, the upfront money will cover the termination fee. Amsc will have to pay one way

  or the other. Further the fact that amsc says it

  must raise at least $100 mil. raises the question

  of how much cash does amsc have?? It sounds

  like they have less then what is on their balance sheet as of Q3.

• Report this Comment On July 02, 2011, at 12:46 PM, murrayhill7 wrote:

  I'm sure the author meant to say 240 million in cash, not "240 billion," though I wish the latter were true -- especially in light of the Sinovel debacle.

  Travis, don't you think you should redact that statement?

  Thanks.

• Report this Comment On July 06, 2011, at 4:22 PM, picador3 wrote:

  Clouds clearing? I',m baffled. Last november AMSC sold nearly $180 million in a stock offering at $35.50 per share. At the time, management knew they had a problem with Sinovel. Did they mention this? No. Instead, both before and after the stock sale they raised earnings guidance for the year, leaving an impression that all was well.

  Now I realize that most successful class action suits end with a settlement that that rewards the lawyers for their efforts but has little impact on the company involved. But here we clearly have omissions of material information during a major stock offering. Maybe it doesn't amount to fraud but it sure doesn't smell right. Neither does the abrupt departure of the Chairman who, incidentally, personally holds several key patents on superconductors

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