American Superconductor to acquire Windtec

Westborough, MA, Nov. 29, 2006 — American Superconductor Corp. (AMSC), an energy technologies company, announced it has signed a definitive agreement to acquire Windtec, a private company based in Klagenfurt, Austria that develops and licenses proprietary wind turbine system designs, and sells wind turbine electrical systems. The transaction’s closing is expected in January 2007.

The Windtec purchase price is 1.3 million shares of AMSC common stock, valued at approximately $12.4 million. The AMSC shares to be issued at the closing are subject to a lockup whereby the sole owner and founder of Windtec, Gerald Hehenberger, may sell only a certain number of shares per year through January 2010.

The all-stock transaction, which is subject to the terms and conditions of the stock purchase agreement, also includes an earn-out opportunity with the potential for another 1.4 million shares of AMSC common stock to be issued to Hehenberger based on the achievement of certain revenue growth targets for the fiscal years ending March 31, 2008 through March 31, 2011. Hehenberger will remain with the company as vice president and managing director of Windtec. The transaction includes the acquisition of Hehenberger’s 27 patents and patents pending worldwide on wind turbine technology.

“According to the Global Wind Energy Council, the installed base of wind generated electricity worldwide is expected to double from approximately 59,000 megawatts in 2005 to nearly 135,000 megawatts in 2010. We believe this acquisition will strongly enhance AMSC’s revenue growth in the wind energy market and speed the time to achieving overall corporate profitability,” said Greg Yurek, CEO and founder of AMSC.

For the 12 months ending December 31, 2006, AMSC expects Windtec’s revenues to be approximately $13 million and its net income to be at least eight percent of revenues, or $1 million. This is up significantly from $2.7 million in revenues and a break-even bottom line for full year 2005. Windtec currently has more than $20 million in backlog that AMSC expects to recognize as revenues in its fiscal year ending March 31, 2008 with higher profit margins than in calendar 2006. After closing, Windtec will be a wholly owned subsidiary of American Superconductor. Its financial results will be reported as part of AMSC’s Power Electronic Systems business unit.

Based on existing backlogs and forecasts, AMSC expects Power Electronic Systems revenues, with the inclusion of Windtec, to more than double from approximately $22.5 million in fiscal 2007 to approximately $50 million for the fiscal year ending March 31, 2008.

AMSC is not assuming any debt in the transaction, and it expects the acquisition to be accretive to earnings beginning in its first full quarter of operations as an AMSC subsidiary.

Windtec designs a variety of wind turbine systems from the ground up, and in certain cases licenses these designs to third parties for an upfront fee and royalty payments for each installation of a Windtec-designed wind turbine system. Windtec also provides consulting services for its licensees who want to upgrade or optimize their wind turbine systems. Licensees normally purchase the wind turbine electrical systems from Windtec, which utilize AMSC’s PowerModule systems to control power flows. Windtec’s customers and targeted markets include industrial equipment manufacturers and engineering construction companies in countries such as Canada, China, the Czech Republic, Germany and India, who are addressing an unmet need for local manufacturers of wind turbine systems.

AMSC plans to retain Windtec’s operations in Austria and its staff of approximately 35 employees, including Hehenberger, who will continue to lead Windtec’s global business development and sales efforts.

American Superconductor also announced that it has received a new order from Windtec for PowerModule systems to be used to control power flow in 165 additional wind turbines in China.

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