January 22 (Renewables Now) - Robert Bosch GmbH has agreed to become a significant strategic investor in Ceres Power Holdings Plc (LON:CWR) in a move that will enable the solid oxide fuel cell (SOFC) specialist to diversify its technology into complementary areas, including hydrogen production.
The German diversified technology group will increase its current stake in Ceres to around 18% from 4% through two transactions. The first one will see Bosch subscribe for close to 11.9 million new ordinary shares for total gross proceeds of GBP 38 million (USD 49.6m/EUR 44.7m), while the second transaction will be a reverse accelerated bookbuild conducted by Deutsche Bank, on behalf of Bosch, to buy up to about 13 million existing Ceres shares. Both the new and existing shares are being effected at a price of GBP 3.2 apiece, which is a premium of 29.5% to the volume weighted average closing mid-market share price for the three months to January 21, 2020. Bosch has confirmed to Ceres that it has no plans to make a takeover offer for the company.
Ceres plans to use the net proceeds from the share subscription along with available cash to expand into high power applications and diversify its technology into complementary areas. One option is to apply its technology in solid oxide electrolysis, which is the process of reversing fuel cells to produce hydrogen and e-fuels from renewable energy. The company noted that early stage testing on this application has delivered encouraging results.
“This new investment will allow us to build upon this strong position and grow the business further into new areas which are needed for the energy transition such as electrolysis for hydrogen and synthetic e-fuels and developing higher power applications while also continuing to focus on the commercialisation of our core power systems,” stated Phil Caldwell, CEO of Ceres.
The beefed up long-term partnership makes Bosch Ceres’ second commercial partner to be a significant strategic investor in the company. The other one is Weichai Power Co Ltd (HKG:2338) of China, currently the owner of a 20% stake in Ceres.
(GBP 1.0 = USD 1.304/EUR 1.178)