CANADA: Ballard to sell German subsidiary to DaimlerChrysler and Ford
Ballard Power Systems has announced that its Vehicular Alliance partners, DaimlerChrysler and Ford, have signed an agreement for the previously announced sale of Ballard's German subsidiary, Ballard Power Systems AG, to DaimlerChrysler and Ford. The transaction is subject to approval by Ballard's shareholders at a special meeting of shareholders to be held in Vancouver on August 29, 2005. The transaction is expected to close shortly after shareholder approval is granted.
"Completing this sale will have four key benefits to Ballard," said President and Chief Executive Officer Dennis Campbell. "First, it provides immediate cash benefit to Ballard with recovery of at least $20 million in expenses incurred since August 2004 and a reduction in annual cash consumption of approximately $25 million. Second, our committed and outstanding share capital is reduced by 14%, on a fully diluted basis. Third, it initiates the Fourth Alliance Agreement and the next-generation development agreements with our Alliance Partners, Ford and DaimlerChrysler, under which our partners will fund up to $59 million for the development of our next-generation vehicular fuel cell and electric drive system. Finally, by divesting BPSAG to our Alliance Partners, we can focus on our core competency, fuel cell development, and on reaching the targets outlined in our Technology Road Map."