B.C. fuel cell makers raise big bucks

Ballard closes US$550 million bought deal; Loop does $100 million IPO

The FCmove is the latest product from Ballard -- a next-generation fuel cell power module for heavy duty transportation. | Submitted

Ballard Power Systems (TSX,NYSE:BLDP) is raising US$550 million through a bought deal public offering – yet more evidence of the renewed zeal for all things hydrogen.

Meanwhile, another B.C. fuel cell maker, Loop Energy, will debut on the Toronto Stock Exchange Thursday in a $100 million initial public offering.

Ballard initially planned to raise US$350 million in a new share offering to a group of underwriters led by TD Securities Inc. But earlier this month, Ballard announced that, due to strong demand, it would increase the offering to US$550 million. That deal closed Tuesday.

Under the deal, Ballard is issuing 14,870,000 common shares at US$37 per share, with an option for underwriters to buy an additional 2,230,500 shares, for an additional US$82.5 million.

TD Securities Inc. and National Bank Financial Inc. acted as the primary underwriters for a syndicate of investment banks that includes BMO Nesbitt Burns Inc., CIBC World Markets Inc., Raymond James Ltd., and Cormark Securities Inc.

The bought deal follows the signing of a memorandum of understanding earlier this month between Ballard and Chart Industries, a major equipment manufacturer in the U.S.

Under the agreement, Ballard and Chart will jointly develop onboard liquid hydrogen storage technology for heavy-duty applications in transportation -- including buses, trucks, rail and marine vessels.

Chart is one of the signatories of the Hydrogen Forward agreement, signed by major players -- including Air Liquide, Anglo American, Bloom Energy, Cummins Inc., Hyundai, Shell and Toyota – to advance hydrogen and fuel cell technology in the U.S.

Ballard’s stock has roughly quadrupled since the beginning of 2020. Other fuel cell companies, like Plug Power (NASDAQ:PLUG) in the U.S., have seen even bigger share price increases.

Neither Ballard nor Plug Power has yet to turn a profit. Then again, neither has Tesla (NASDAQ:TSLA), which is now the most valuable automobile manufacturer in the world by market cap.

The renewed zeal for hydrogen fuel cell stock is being driven largely by government policy. Several governments in the developed world have adopted net zero by 2050 plans, policies to phase-out of gasoline powered cars, and hydrogen adoption and production strategies.

More recently, U.S. President Joe Biden’s $2 trillion commitment to make America green has been driving investors into clean energy, with hydrogen and fuel cell technology companies enjoying a sizeable share of the frothiness.

As for Loop Energy, it will debut on the Toronto Stock Exchange on Thursday under the symbol LPEN.

Loop plans to issue 6,250,000 common shares at $16 per share.  National Bank Financial Inc. is the lead underwriter of a syndicate that includes CIBC World Markets Inc., Raymond James Ltd., Canaccord Genuity Corp. and Cormark Securities Inc.

nbennett@biv.com

@nbennett_biv