Shares in Ballard Power Systems (TSX: BLDP) are surging after the Burnaby-based company announced investments totalling $183 million.
The company known for developing hydrogen fuel cell technology said Wednesday (August 29) it’s selling a 19.9% stake to China’s Weichai Power Co. in a deal worth $163 million.
Meanwhile, Zhongshan Broad-Ocean Motor Co., Ltd., which already has a 9.9% ownership stake in Ballard, will invest another $20 million in the Canadian company to maintain its ownership position.
Shares were up 19.31% to trade at $4.51 as of 11:30 a.m. PT on the morning the deal was announced.
Ballard says it will form a joint venture as a result of the deal that sees Weichai committing to build at least 2,000 fuel-cell modules for commercial vehicles in China.
"As strategic partners and shareholders, Weichai and Broad-Ocean are strongly aligned with the interests of Ballard's shareholders,” Ballard CEO Randy MacEwen said in a statement.
“Weichai's announced plan to deploy a minimum of 2,000 fuel cell commercial vehicles in China by 2021 is the largest commitment of commercial FCEVs [fuel cell electric vehicles] to date globally.”
The agreement is expected to close by the end of the fourth quarter of 2018.