News

Ballard Shareholders Approve Sale of German Subsidiary

August 29, 2005 by Jeff Shepard

Ballard Power Systems Inc. (Vancouver, BC, Canada) stands to receive more than $20 million in cash back after shareholders approved a deal to sell the company's stake in its German fuel cell development subsidiary, Ballard Power Systems AG, to its partners in the project - Ford Motor Co. and DaimlerChrysler AG. Under the deal, DaimlerChrysler and Ford will return to Ballard nine million common shares of the company in exchange for Ballard's 50.1 percent interest in Ballard Power Systems AG, a developer of fuel cell support systems. The deal further strengthen's the company's war chest, which will be used to finance its future development.

"It relieves us of a significant financial burden that we were eager to get rid of," stated Ballard CEO Dennis Campbell. "The biggest benefit to us is the reduction in future cash consumption. Today, we've got a pretty strong balance sheet at the moment, but we've got a technology road map that we've published and we need the cash to execute that road map."

The German unit sale, which will reduce Ballard's annual cash consumption by about $25 million, will also see the company reimbursed for net operating expenses incurred between August 1, 2004, and the closing date of the deal, estimated to be worth more than $20 million. Ballard will continue to be responsible for the design, development, and manufacture of vehicular fuel cells for its alliance partners, while DaimlerChrysler and Ford will be jointly responsible for the design, development, and manufacture of the vehicular fuel cell support system.