KPS

Acquisition Opportunity

Kite Power Systems Limited

Hilco Streambank and Hilco Valuation Services are seeking offers to acquire the intellectual property and tangible assets of airborne wind energy pioneer Kite Power Systems Limited (“KPS” or the “Company”).

BID DEADLINE

27 January 2020 @ Noon GMT

Business & Technology Overview

KPS is at the forefront of developing a new airborne wind powered generation system that will deliver clean, low cost electricity at utility scale through its development of an innovative multi-kite airborne technology system.The kites fly higher than conventional wind turbines allowing them to operate in stronger and more consistent winds which in turn significantly reduces the costs of comparable systems.

Research and development of the KPS technology has been carried out since 2011 by a team of highly experienced engineers. Over £8m has been invested in the development of the Company’s technology to date. Investors have included E.ON, Schlumberger and Shell Technology Ventures.

KPS aims to become the global leader in Airborne Wind Energy which will ultimately start to take market share from the Horizontal Axis Wind Turbine manufacturers. The KPS technology will provide a viable low-cost solution to deep water floating wind energy installations with multi MW scale devices. This global market is estimated to be more than 6,000 GW installed by 2050.

KPS has identified the weaknesses in the conventional methods of harnessing wind energy and seeks to address them through its groundbreaking technology. This technology is being designed to access places that conventional methods cannot (deeper sea, higher altitudes where the winds are stronger and remote areas), and to do so using substantially less material than wind turbines.

The Company’s technology, in-development, consists of a multi-kite system that secures continuous energy production by flying at least two kites as high as 1,500 feet in the same airspace at any given time, so that while at least one is generating power the other(s) can be retracted and kept rotating at optimal speed. The kites are attached by tethers to winch systems that drive a generator. By achieving flight speeds of up to 100mph in 20mph winds, the kite’s tether tension causes the line to spool out from a drum, which turns a generator, thus producing electricity. KPS has a patented design system that reduces maintenance of its multi-kites, all components are serviced at an accessible height, and the Company uses specialist materials to maximise yield, as well as a winch design pending patent that optimises the entire system.

KPS systems are designed to be modular. The KPS design calls for one kite for each winch with a centralised power conditioning block utilised to handle this. Up to ten winch and kite systems are connected to the power conditioning unit which uses batteries to store energy and then uses the batteries the provide a steady output to the grid. Connecting multiple winch and kite units to a single power conditioning unit reduces costs. KPS’ lightweight ‘Air Beam Wing’ kite design further reduces costs when compared to other build methods. The Company’s models are showing that the cost will be at least 25% cheaper than a carbon fibre wing. The Air Beam Wing technology has been developed by the Company to overcome the primary challenges of Airborne Wind Energy: minimising the mass of the kite whilst providing enough structure to attach control effectors. Differentiating it from most other build methods, the Air Beam Wing employs several airship technologies which will scale efficiently allowing the concept to be used in multi-MW devices.

The Company’s technology has the potential to transform the global onshore and offshore wind generation markets, as it is cheaper to manufacture and requires less construction and installation materials than conventional wind turbines. The Company believes the KPS technology could reduce the capital expenditure associated with of conventional offshore turbines by as much as 50% because its patented power system does not require large quantities of steel or specialist installation vessels. In addition to the Balance of Plant being lower than traditional wind turbine, KPS will have a better effective wind efficiency per m² active area.

To date, the Company has been focussed on two main streams of work – the development of a sub-scale testing unit and designing a larger 500 kW system. In 2019 KPS has been flying its sub-scale system in Germany, developing automated launch and land algorithms. KPS’ design efforts over the last year have included conducting a scaling study which showed that the technology path could scale to at least 15 MW. The Company has subsequently taken those technologies and scaled them down to 500 kW. The 500 kW design has reached the preliminary design stage and was due to fly for the first time in 2021. The Company’s intention was to produce a 500kW rated onshore product to gain technology traction and generate revenue, which in turn would fund the product development for a future multi MW offshore product. The Company expected to generate first revenues, from energy sales or unit sales, and achieve multiple commercial developments by 2023.

This is a unique opportunity to acquire the assets behind pioneering high-altitude wind power generation technology.

KPS 2

Available Assets

Patent Portfolio

The Company’s unique technology is protected by a suite of patents. The Company’s patent portfolio consists of over 20 granted and pending patents across several patent families including those entitled “Asymmetric Kite”, “Lower Power Generation”, “Active Trailing Edge”, “Umbrella”, “Winch”, “Docking System”, “CAT”, “Wing Build, “Chariot” and “Inflatable Wing Build”.

International coverage is provided with protection in 10 global territories.

The Company’s patents primarily relate to unique features of the Kite Power Systems technology, including the construction of the panels of a kite used to collect wind energy and the mechanical coupling of a kite and tether through which energy is collected.

Intellectual property protection has been sought for key aspects of the Company’s current technology stream including the KPS Air Beam Wing Build Method (filed) and Winch (notably accepted for grant in the United States) as well as elements of future technology stream – Chariot System (filed). Further elements of the future technology stream - Multi-Wing Kite and Single Device & Array Machine Learning - have been identified as potentially patentable.

A patent schedule is available to be downloaded here.

Organisational Knowledge

The Company’s significant organisational knowledge relating to technical development to date includes: extensive design drawings and specifications; the KPS Kite Control SCALA-based advanced simulation model and control developed in-house from 2011 to present; flight test data collected with soft kites over the period 2011-2017; flight data from further Kite Control development work conducted in collaboration with a German University which has an international reputation in UAV development from 2018 to present; advanced control methodologies and simulation model (built and validated against test data) relating to KPS’ implemented and tested Winch Control development work.

Brand

The KPS brand is well-known and highly regarded in its sector, having been at the forefront of the development of kite power generation technology since 2011.

The brand and technology have been promoted via the Company’s attendance at various tradeshows, and discussions and collaboration with partners. The brand has additionally been featured in several press articles from outlets such as the Guardian and the Independent, as well as appearing on the BBC1 show, The One Show.

KPS is recognised as an innovator in the field of wind energy. KPS received the Research and Development Programme of the Year accolade in 2015.

Trade Marks

The Kite Power Systems corporate brand name, “KPS”, and logos are protected by numerous trade marks registered in the UK and internationally. A trade mark schedule is available to be downloaded here.

Website Content

The Company’s attractive and informational website, hosted at www.kps.energy, has been professionally developed. It showcases the Kite Power Systems technology.

Domain Name

The Company owns the branded domain name kps.energy.

Social Media

Facebook: @KitePowerSolutions

Twitter: @KPSEnergy

YouTube: @KPS

Tangible Assets

Various items of equipment, fixtures and fittings located in Glasgow office premises, a Castle Kennedy, Stranraer-based hangar and in Germany. Tangible assets include items such as: high specification winches and beams; high specification sensors including a LIDAR and pitot tube, model aircraft; soft kites; various spare parts for the KPS Mid-Scale System; an accumulation station; double piston accumulators; and a kite launching hook system with hydraulic mechanism.

Sales Process

Offers are due 27 January 2020 @ Noon GMT.

All offers should be directed to Hilco Streambank in writing. A bid submission form is available.

Key Terms & Conditions

The bidder acknowledges that Hilco acts as an agent for the Company who offer for sale only what right, title and interest (if any) the Company possesses in the assets. Such sale will be without any warranties, expressed or implied. The information provided has not been verified by Hilco and bidders are deemed to have carried out their own due diligence of the assets.

West Freugh site tangible assets and associated environmental survey data are excluded assets.

A non-refundable deposit of 20% will be payable by the buyer within 48 hours of bid acceptance. VAT, if applicable, at 20% will be added to the price. A buyer’s premium of 10% applies to this sale. Legal completion to occur within 5 business days of bid acceptance. Hilco Streambank's full Terms and Conditions apply.

Contact Us

For further information please contact the following Hilco Streambank representatives:. 

Interested Parties

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