VANCOUVER, BC and ZHONGSHAN,
China, Feb.
16, 2017 /PRNewswire/ - Ballard Power Systems (NASDAQ: BLDP;
TSX: BLDP) today announced that it has signed a definitive
agreement relating to technology transfer, licensing and supply
arrangements with strategic partner Zhongshan Broad-Ocean Motor
Co., Ltd. ("Broad-Ocean"; www.broad-ocean.com/en/index.html) for
the assembly and sale of FCveloCity® 30-kilowatt (kW)
and 85kW fuel cell engines in China. Under the deal, Broad-Ocean will
manufacture fuel cell modules in three strategic regions in
China, including Shanghai. The deal has an estimated value of
approximately $25 million in revenue
to Ballard over the initial 5-year term, including $12 million in Technology Solutions revenue.
Randy MacEwen, Ballard President and CEO said, "Converging
macro trends in China, including
large-scale urbanization, continued build-out of mass urban
transportation, degrading air quality and a mandate to address
climate change, together present an historic opportunity for
zero-emission fuel cell solutions in the world's largest mobility
market. Our strategic partnership with Broad-Ocean is a central
piece in our China strategy,
premised on the establishment of a comprehensive local fuel cell
supply chain and related ecosystem to address the fast-growing
clean energy bus and commercial vehicle markets."
Mr. MacEwen continued, "We are thrilled to have Broad-Ocean as a
key partner to accelerate adoption of fuel cell-powered heavy-duty
vehicles in China. Ballard's fuel
cell modules will be locally manufactured in key Chinese markets by
Broad-Ocean, a highly-regarded company that has manufacturing
scale, supply chain muscle, operations excellence, relationships
with government and with bus and commercial vehicles OEMs, and a
strong balance sheet. Ballard will also benefit from Broad-Ocean's
demand pull-through of fuel cell vehicles for use in its own new
energy vehicle leasing business."
Mr. Charles Lu, Founder and
Chairman of Broad-Ocean added, "Hydrogen fuel cells are entering an
exciting new growth phase in China
and we intend to be at the forefront. We believe that this
cooperation between Ballard and Broad-Ocean combines the strengths
of both companies and will put us in a leading position in this new
hydrogen fuel cell growth phase in China."
In each of the three assembly operation locations, Broad-Ocean
plans to engage with local governments as well as with bus and
commercial vehicle OEMs for deployment of fuel cell buses and
commercial vehicles incorporating Ballard-designed modules
manufactured by Broad-Ocean.
Broad-Ocean will make payments to Ballard at closing and based
on certain commissioning milestones, initial supply agreements, and
recurring royalty payments. Ballard will also have the exclusive
right to purchase fuel cell engines from any of the Broad-Ocean
manufacturing operations for sale outside China.
Each fuel cell engine assembled by Broad-Ocean will utilize
FCvelocity®-9SSL fuel cell stacks, initially
manufactured by Ballard at its Vancouver HQ facility. Stack supply
will be transferred to Guangdong Synergy Ballard Hydrogen Power
Co., Ltd. ("JVCo"), the joint venture owned by Guangdong Nation
Synergy Hydrogen Power Technology Co. Ltd. ("Synergy") and Ballard
in the City of Yunfu in China's
Guangdong Province, once JVCo
becomes fully operational, expected in late-2017. From that time
forward, Ballard will supply membrane electrode assemblies (MEAs)
on an exclusive basis for stacks manufactured by JVCo.
This transaction is subject to customary closing conditions and
is expected to close by Q2 2017.
Founded in 1994, Broad-Ocean is headquartered in the City of
Zhongshan in Guangdong Province
and is listed on the Shenzhen Stock Exchange. The Company is a
leading global manufacturer of motors that power small and
specialized electric machinery for electric vehicles (EVs),
including buses, commercial vehicles and passenger vehicles, and
for heating, ventilation and air conditioning (HVAC). Broad-Ocean
produces more than 50 million motors annually for customers on 5
continents. On August 18, 2016
Broad-Ocean became Ballard's largest shareholder following an
investment of $28.3 million in
Ballard common shares, representing approximately 9.9% of Ballard's
outstanding common shares following the transaction.
About Ballard Power Systems
Ballard Power Systems
(NASDAQ: BLDP; TSX: BLDP) provides clean energy products that
reduce customer costs and risks, and helps customers solve
difficult technical and business challenges in their fuel cell
programs. To learn more about Ballard, please visit
www.ballard.com.
This release contains forward-looking statements concerning
planned product deployments, provision of services, market adoption
and demand for our products and available subsidies. These
forward-looking statements reflect Ballard's current expectations
as contemplated under section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Any such forward-looking statements are based on Ballard's
assumptions relating to its financial forecasts and expectations
regarding its product development efforts, manufacturing capacity,
and market demand.
These statements involve risks and uncertainties that may cause
Ballard's actual results to be materially different, including
general economic and regulatory changes, detrimental reliance on
third parties, successfully achieving our business plans and
achieving and sustaining profitability. For a detailed discussion
of these and other risk factors that could affect Ballard's future
performance, please refer to Ballard's most recent Annual
Information Form. Readers should not place undue reliance on
Ballard's forward-looking statements and Ballard assumes no
obligation to update or release any revisions to these forward
looking statements, other than as required under applicable
legislation.
This press release does not constitute an offer to sell or the
solicitation of an offer to buy securities. The Ballard
Common Shares have not been registered under the United States
Securities Act of 1933, as amended, or the securities laws of any
other jurisdiction and may not be offered or sold in the United States absent registration or an
applicable exemption from registration requirements.
SOURCE Ballard Power Systems Inc.