Ceres Power enters strategic collaboration with Bosch

Fuel cell developer Ceres Power Holdings has agreed a strategic collaboration with German engineering giant Robert Bosch, as well as a £9.0m strategic equity investment by Bosch into Ceres.

Intellectual property-based business developer IP Group currently holds a direct undiluted beneficial stake of 22.4% in Ceres, which develops the low cost solid oxide ‘SteelCell’ fuel cell technology. The patented technology generates power from widely available fuels at high efficiency and is manufactured using standard processing equipment and conventional materials such as steel, meaning that it can be mass produced at an affordable price for domestic and business use.

The collaboration with Bosch, which comes after Ceres announced signed a joint development agreement in January but did not reveal that it was with the German conglomerate, aims to further develop Ceres' technology, establish low-volume production at Bosch, and enable the future scale-up and mass manufacture of the SteelCell for use in multiple applications including small power stations to be used in cities, factories, data centres and charge points for electric vehicles.

The agreements provided “very significant” staged revenues to Ceres through technology transfer and licensing and longer-term royalties on 5kW SteelCell stacks, as well as initial engineering services, IP Group explained.

Ceres said the initial value to 2020 would be around £20.0m, subject to performance criteria.

As part of the deal, Bosch would make a £9.0m equity investment in Ceres by subscribing for 5,973,660 new ordinary shares at 150.8p each, equating to approximately 4.4% of the expanded issued share capital.

Bosch highlighted SteelCell's "highly efficient" and "very low emission" technology, @has an important role to play in energy systems' security of supply and flexibility".

Ceres CEO Phil Caldwell said: "The vision for our partnership with Bosch is to set a new industry standard for solid-oxide fuel cells, leading to widespread adoption in distributed power supplies. By combining Ceres' unique SteelCell technology with Bosch's engineering, manufacturing, and supply chain strength we will establish a strong partnership that can make our technology even more competitive and prepare it for potential mass production."

“We're delighted with the progress made by Ceres since we first invested in the company in 2012,” said IP Group chief executive Alan Aubrey. “The Ceres team has made excellent headway and the company is extremely well positioned in this growing market.”

Earlier in the month, Ceres signed a new partnership with Nissan to further develop fuel cell technology for electric vehicle applications, which saw Ceres and the Welding Institute awarded a total of £8.0m UK government funding through the Advanced Propulsion Centre for the project.

That followed news of a strategic collaboration with China's Weichai Power, comprising both product development for China's fast-growing electric powered bus market) as well as an equity investment.

Last month, Ceres also announced a significantly oversubscribed £20.0m fundraising.