logo-loader
viewBallard Power Systems Inc.

Shares in Canada’s Ballard Power climb after it signs pact to sell non-core assets in Protonex

The company will receive US$16mln in cash as part of the sale, but it will retain certain assets related to fuel cell propulsion systems for military and commercial unmanned vehicles

The offices of Ballard Power Systems Inc USA
Ballard CEO Randy MacEwen says the company decided to divest Protonex assets that are 'no longer aligned with Ballard's strategic fuel cell focus'

Shares of Ballard Power Systems Inc USA (NASDAQ:BLDP, TSX:BLD) climbed Tuesday in premarket trade after the Canadian fuel cell company signed a pact with a private company called Revision Military Ltd, to sell non-core assets of its subsidiary, Protonex, related to its power business.

Ballard will receive US$16mln in cash as part of the sale. However, it will still retain certain assets related to fuel cell propulsion systems for military and commercial unmanned vehicles. 

Shares of Ballard Power listed on Nasdaq shot up 5.9% to US$3.75 before the opening bell.

 "This divestiture is consistent with our strategy of continuous portfolio optimization,” said Ballard CEO Randy MacEwen. “We decided to divest Protonex assets that are no longer aligned with Ballard's strategic fuel cell focus, while retaining assets related to the unmanned vehicle market, under the Ballard brand. The divestiture reduces complexity while adding fuel for us to invest in our core fuel cell business."

READ: China’s Weichai Power pours US$163mln in Canada’s Ballard Power for a majority stake in the company

In 2015, Ballard paid roughly US$17.5mln in shares and cash to acquire Protonex, which included the power manager business, a solid oxide fuel cells business and the unmanned vehicle business.

The CEO said Ballard had originally acquired Protonex to provide “strategic diversification” and “to engage the US military complex” as a potential customer for portable fuel cell products.

“With the developing value proposition and attractive market opportunities for fuel cell electric vehicles or FCEVs in Heavy and Medium Duty Motive markets, including bus, truck, rail, marine and other applications, we are divesting the power manager business to focus on core fuel cell market opportunities,” said MacEwen.

Ballard was in the news last week after it secured around US$163mln from Weichai Power Co Ltd and established a joint venture in China. The substantial investment makes  the Chinese automotive and equipment manufacturer Ballard's largest shareholder.

Separately, Zhongshan Broad-Ocean Motor Co. Ltd, a current Ballard investor and a Chinese partner, also agreed to invest a further US$20mln at a 15% premium to maintain its 9.9% stake in Ballard. As a result, the Weichai and Broad-Ocean equity investment in Ballard now totals approximately US$183mln.

Contact Uttara Choudhury at [email protected]

Follow her on Twitter@UttaraProactive 

Quick facts: Ballard Power Systems Inc.

Price: 11.37 USD

NASDAQ:BLDP
Market: NASDAQ
Market Cap: $2.77 billion
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Full interview: GlobeX Data begins a social media influencers program for...

GlobeX Data (OTCQB: SWISF- CSE: SWIS) CEO Alain Ghiai joined Steve Darling from Proactive Vancouver with news the company has started a social media influencers program to help get the word out about their cybersecurity products. Ghiai telling Proactive how the program will work and the...

17 hours, 19 minutes ago

2 min read