Ballard Takeover? You never know.
Acquisitions Possible For Cash-Flush Ballard
Van_Sun - 2/25/00 12:39:22 PM
Soaring Stock Price Has Enriched Value Of Share Offering, Expanding
Original Plan For Its Proceeds.
William Boei, Sun Business Reporter Vancouver Sun
Ballard Power Systems Inc. [T.BLD] said Thursday it may go shopping
for acquisitions after it raises half a billion dollars or more with a new
share offering. The Burnaby fuel-cell maker said the value of the
offering is now $499.2 million, more than 70 per cent higher than the
$289 million it expected when it announced the offering in late January.
Ballard is sticking to its plan to issue 3,245,000 shares, and its share
value has soared in the past month.
In January, Ballard said it would use the proceeds to help commercialize
fuel cells, develop manufacturing processes, build its first fuel-cell
factory and for "general corporate purposes." On Thursday, Ballard
added: "A portion of the net proceeds may also be used to pursue
acquisition opportunities [including intellectual property] that have
strategic value." Ballard officials declined to elaborate, other than to say
the possibility of acquisitions had been noted in the prospectus for the
offering. "There are lots of interesting pockets of technology, some of
which may be of interest to them," said Richard Morrow, a stock analyst
with CIBC World Markets in Toronto. Morrow said Ballard could be
interested in rival fuel-cell makers as well as companies with other
fuel-cell-related technologies. The offering, priced at $153.84 per share,
is scheduled to close March 2. It is being managed by a group of
underwriters headed by Morgan Stanley Dean Witter.
Ballard said if the offering is over-subscribed, the underwriters have an
option to buy an additional 486,750 shares, which would raise an extra
$75 million. When the offering was first announced, Ballard shares
(TSE: BLD; Nasdaq: BLDP) were valued at $81.90 each. Since then,
fuel-cell stocks have been soaring as analysts and investors became
convinced fuel cells are a viable power-generating alternative and that
their commercial production is drawing closer. Last week its partner, the
Royal Dutch Shell Group [RD], unveiled a new technology to use
gasoline as a fuel in fuel cells. That could reduce the need for new
infrastructure for fuel cell-powered automobiles. Morrow said the main
push for Ballard's share price has been the realization that
"commercialization may be nearer at hand than some expected."
Ballard's share price peaked earlier this week at $178. For the last two
days it has been sliding, along with most other technology stocks. On
Thursday, it slipped $10.55 to close at $153.45. |
