Ballard Generation Systems completed $110m agreement with GEC ALSTHOM
Ballard Power Systems Inc BLD
Shares issued 23,083,665 May 28 close $142.40
Fri 29 May 98 News Release
Mr. Paul Lancaster reports
The company's subsidiary, Ballard Generation Systems, has completed its
$110-million ($76.25-million (U.S.)) agreement with GEC ALSTHOM to bring
manufacturing and marketing expertise into the company for PEM fuel cell
stationary power plants.
Representatives met in Basel, Switzerland, to complete and sign the final
alliance agreements. The companies have worked toward this objective since
signing a memorandum of understanding on Dec. 18, 1997, in Vancouver,
Canada.
In the transaction, GEC ALSTHOM will invest $39-million (U.S.)
($56.5-million (Canadian)) for a 21.4 per cent interest in Ballard
Generation Systems in the form of $21-million (U.S.) ($30.5 million
(Canadian)) in cash and $18-million (U.S.) ($26 million (Canadian)) in
manufacturing technology and expertise. This alliance with GEC ALSTHOM will
result in Ballard Generation Systems establishing an initial production
facility in Canada to manufacture 250 kW fuel cell stationary power plants.
In addition, Ballard Generation Systems and GEC ALSTHOM will jointly invest
$37.25-million (U.S.) ($54-million (Canadian)) to form a European joint
venture company called ALSTHOM BGS for the sale, distribution and
subsequently the manufacture of fuel cell power plants in Europe. The
investment in the European joint venture consists of $19-million (U.S.)
($27.5 million (Canadian)) in cash from GEC ALSTHOM for a 51 per cent
interest, and $18.25-million (U.S.) ($26.5-million (Canadian)) for the
marketing and manufacturing rights in Europe from Ballard Generation
Systems for a 49 per cent interest.
Ballard Generation Systems was formed as a venture between Ballard Power
Systems and GPU International Inc. of New Jersey in December 1996. In May
1998, Ballard Generation Systems announced that it had signed a detailed
memorandum of understanding with EBARA Corporation, headquartered in Tokyo,
Japan, to create a joint venture company with exclusive rights to market,
and later to manufacture, Ballard's PEM fuel cell stationary power plants
for the Japanese market.
GEC ALSTHOM is a world leader in the design, manufacture, supply and
installation of equipment, systems and complete solutions for the power
generation and transmission industries and for rail transport.
Headquartered in France, the company is well established internationally,
with a total of 110,000 employees in 60 countries. GEC ALSTHOM has pro
forma revenues of approximately $15.7-billion (U.S.) in 1997/98 of which
over 40 per cent were earned outside Europe.
GPU International is the non-regulated arm of GPU Inc., a major
international electric company based in New Jersey. GPU serves a worldwide
population of over 13 million people with 4.4 million customers in 12
countries. It had 1996 revenues of over $3.9-billion (U.S.) and assets
close to $10-billion (U.S.).
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