Ceres Power Holdings plc signed a joint-venture (JV) development agreement with Cummins Power Generation Inc., a wholly owned subsidiary of Cummins Inc. The company also announced its intention to raise approximately £20.0 million (approximately £19.6 million net of expenses) by way of an oversubscribed placing. The proposed Placing will raise approximately £20.0 million through the issue of 235,705,868 shares for 8.5 pence per share. The Placing will be to existing and new institutional investors and certain Directors and has been oversubscribed.
In the first stage of the JV agreement, Cummins and Ceres will work together on a non-exclusive basis, combining their complementary technical capabilities and market know-how with Ceres assuming responsibility for the Steel Cell fuel cell system technology and Cummins providing system integration expertise, focusing on the assessment of applications for Cummins' core markets of larger scale back-up power and prime power applications.
Further stages of the agreement could include Cummins and Ceres working together on system feasibility and the evaluation of potential development programs with major end users and utilities, who are already expressing interest in using power systems incorporating Ceres' Steel Cell technology. Successful completion of this collaboration assessment agreement phase could lead to a broader cooperative system development program under a continuation agreement.
Phil Caldwell, CEO of Ceres Power, commented: "We are very pleased to start working with a partner of the caliber of Cummins. Establishing a strategic relationship with Cummins enables us to explore further applications for our unique Steel Cell technology, particularly for the rapidly growing market for fuel cell generation for commercial applications in North America."
Robert Lee, Executive Director, Power Generation Strategy for Cummins Power Generation, commented: "As a global leader in power generation, Cummins Power Generation is pleased to undertake this joint investigation with Ceres into Solid Oxide Fuel Cell technology as a potential new vehicle to provide our customers with the clean and efficient power they've come to expect from Cummins."