Temiz Yaratici Teknolojiler signs framework agreement with Absolicon to acquire Production line in Turkey

Fri, Oct 23, 2020 14:00 CET

Temiz Yaratici Teknolojiler (TYT) has signed a framework agreement with Absolicon for the acquisition of a production line for the T160 Solar collector in Turkey during 2023. TYT is a Turkish company developing renewable technologies. The total sales value covered by the agreement is estimated at € 4-5 million plus a monthly license fee of 4% and sales of components. The framework agreement prescribes the principles for the separate agreements to be drawn up.

Content of the framework agreement

The framework agreement describes the separate agreements to be drawn up in the process. Absolicon's proceeds from the sale can be grouped into three groups: acquisition of the line, license revenue and revenue from material sales.

1. Sale of the production line

The production line is of the same model as Absolicon has in Sweden and which the company has already delivered to Sichuan Province. The line with two six-axis robots has the capacity to produce 50 MW solar collectors (100,000 m2) per year. Together with the hardware, Absolicon provides consulting support for marketing and technical support, development and technical training.

The total value of hardware and activities covered by the agreement is estimated at € 4-5 million.

2. License to manufacture T160

For the right to manufacture T160 under Absolicon's intellectual property protection, take part in future product development and use Absolicon's trademark, a monthly license fee of approximately 4% applies to the sales value.

The production line in full production produces on a shift 50 MW solar collector (100 000 m2) per year with sales value € 20-25 million which with 4% license fee would mean about € 800 000 per year in license revenue. Absolicon's estimate, however, is that it takes time for TYT to develop the solar thermal market for industries in the region so that these volumes can be achieved.

3. Material supply

Through the agreement, Absolicon ensures access to patented components and high-quality inputs partly manufactured in Turkey or locally at the installation site.

At full production, the production line needs to buy materials for € 10-15 million per year where 20% - 30% of purchases may go through Absolicon and 70% - 80% from local subcontractors. The outcome for Absolicon depends to some extent on the result of Absolicon's ongoing material investment.

The framework agreement sets out overarching principles

The framework agreement prescribes the general principles for the separate agreements to be drawn up, and the steps to be taken before a binding agreement for the acquisition of the production line can be signed. The estimated value of sales is subject to change as well as the definitive design of the production capacity of the production line. Absolicon estimates today that the sales value of the agreement is at the lower end of the range of € 4-5 million.

If TYT fails to meet its commitments at every stage, they lose the right to complete the acquisition and then have the opportunity to recover part of the purchase price, but never for Absolicon's incurred costs.

Market potential

Turkey has excellent solar resources and industrial sector environment which made suitable for Absolicon solution. One third of the final energy consumption by the industries comes from oil products. When replacing only 10% of the industrial oil consumption, the estimate market potential for the T160 solar collectors is almost 2 million square meters (1GW, 350 000 solar thermal collectors).

Temiz Yaratici Teknolojiler (TYT) is a Turkish company that develops smart, renewable technologies for a sustainable future. The company has extensive experience in developing and implementing innovative technologies and projects that accelerate the adoption of new energy technologies, such as photovoltaics and and CSP solutions.

The collaboration is built on the experience and quality of TYT. TYT was awarded by international institutions: Forbes on List of 30 Under 30 (2017), MIT Technology Review as Innovator of the year (2014) as well as their commitment for a sustainable future.

The largest segments of Absolicon's solar collector technology in the region are:

Food industry: Turkey has a large agricultural sector
Mining industry: Turkey has a strong and growing mining sector
Chemical industry: The third largest industry export sector in Turkey with thousands of industries in household chemicals, plastic and petrochemical.

Next steps

In this case, negotiations for the signing of the framework agreement have been fast and cooperation is still at an early stage. Discussions have just begun on the first pilot installations of the T160 in Turkey. More detailed contract writing is now taking place and TYT will undergo Absolicon's partner training. Payment is made step by step in the same way as in the previous sale of the production line to the province of Sichuan.

This disclosure contains information that Absolicon is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 23-10-2020 14:00 CET.

Joakim Byström vd Absolicon Solar Collector AB
Email: joakim@absolicon.com
Phone: +46 611-55 70 00

Press: https://www.absolicon.com/press-news/press-material/

Absolicon is a listed Swedish solar energy company, specializing in concentrated solar heating. The solar collector T160 operates up to 160°C and has the highest optical efficiency ever measured for a commercially available small parabolic trough. After achieving groundbreaking performance, Absolicon has built two robotized production lines, one in Sweden and one in China that can produce 50 MWp(th) annually, one 5.5 m2 solar collector every six minutes. The company combines solar energy research with sales of solar collector fields to industries that need heat and steam and complete robotic production lines for T160.