HORSHAM, England, June 25, 2018 /PRNewswire/ --
Ceres Power (AIM: CWR) ("Ceres Power", "Ceres"), developer of
the SteelCell®, a world-leading, low cost Solid Oxide Fuel Cell
(SOFC) technology, is pleased to announce that Weichai Power
("Weichai") has received relevant approvals from the People's Republic of China (PRC) for its
proposed equity investment in Ceres announced on 16 May 2018.
- Further to the announcement made by Ceres on 16 May 2018, relevant competent authorities in
the PRC have approved the proposed equity investment by Weichai in
Ceres.
- Approval covers the initial investment of c.£17m to take a 10%
stake in Ceres and is priced at 15.08p / share, an 18% premium to
the date of the initial announcement.
- Approval also covers the additional potential equity investment
of c.£23.2m which is conditional on the signing of further
commercial agreements before 30 November
2018.
- Approval marks a significant milestone before the formal start
of the relationship with Weichai, one of the leading automobile and
equipment manufacturing companies in China.
- The parties will initially work on jointly developing and
launching a fuel cell range extender system for China's fast growing electric powered bus
market.
Ceres will now seek shareholder approval for authorities to
issue the Ordinary Shares arising from these investments, and will
shortly send out a Notice to a General Meeting.
The second potential equity investment of c.£23.2m will be by
way of warrant at an exercise price of 16.45p/share, a 29% premium
on the market value at the time of the initial announcement. This
warrant will allow Weichai to hold in aggregate a 20% equity
holding in Ceres and will be automatically exercised on the signing
of the further commercial agreements expected later in 2018,
subject to certain conditions.
Alongside the investment, Ceres and Weichai intend to enter a
broader strategic collaboration to jointly develop and launch a
SOFC fuel cell range extender system for China's fast growing electric powered bus
market. Weichai has a wide network of customers in China with sales volumes of c.30,000 buses per
year.
The strategic collaboration is currently expected to begin with
an initial Fuel Cell System technology transfer to Weichai in 2018
for the development and demonstration of CNG fueled SteelCell® SOFC
hybrid electric buses in China by
2019. The parties then expect to progress to further trials of
multiple buses and SteelCell® SOFC stack supply by 2020.
Weichai is listed in Hong Kong
and Shenzhen with a market
capitalization of c. US$10bn, and has
a strong track record of making strategic investments in businesses
around the world, including Société Internationale des Moteurs
Baudouin in France, Power
Solutions International lnc. in the U.S. and KION Group AG
(MDAX-listed) in Germany.
The low-emission public transport market in China represents a major commercial
opportunity for Ceres's technology. This is being driven by the
Chinese Government, which is stimulating this sector through
subsidies and Zero-Emission Zones designed to reduce air pollution
and carbon emissions, while increasing public health and lower
operating costs.
In addition to these benefits and increasing the operational
range of electric buses, the Ceres Power range extender has the
advantage of being able to run on widely available fuels such as
CNG and does not rely on the roll out of hydrogen
infrastructure.
Phil Caldwell, CEO
said:
"We are delighted to receive PRC approval for
Weichai's investment in Ceres. The strategic
partnership with Weichai, with its huge scale,
leading market position and manufacturing expertise, has
the potential to bring considerable benefits to Ceres
and accelerates the commercial
adoption of our technology. Although focused
on delivering fuel cell range extenders in electric buses
initially, this partnership provides us with invaluable access to
the Chinese market as a whole. This funding will provide
important growth capital for Ceres as we scale up the
business.
"We look forward to working alongside Weichai
and our other existing partners in developing our world-leading
technology and extending its commercial applications across a
number of markets and geographies."
For further information please contact:
Ceres Power Holdings plc
Phil Caldwell, CEO
+44(0)1403-273-463
Powerscourt
Peter Ogden
+44(0)20-7250-1446