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Overview of the Deal
On 22nd January 2020, Ceres Power Holdings Plc, announced that Robert Bosch GmbH, a German engineering giant had increased its equity shareholding in the company from 4 per cent to around 18 per cent. It was reported that this would allow the company to raise around â¬38.0 million in gross proceeds, which will be utilised by the group for the purpose of funding additional product uses for solid oxide fuel cells (SOFC). SOFC is one of the companyâs flagship products. The company also highlighted that it is for the purpose of diversification of Research and Development around the potential electrolysis applications from the companyâs flagship technology. This move is a major step in the partnership, which was first established in the month of April 2018, and which allowed both the companies to expand their technology as well as manufacturing in both Germany as well as the United Kingdom.
About â Bosch Global
Bosch Global is a Germany based engineering company, that engages in the research and development of various engineering and technical products, especially for industrial purposes. The company provides its products and services in areas such as Mobility, Home, Industry and Trading, as well as market-specific solutions to Infrastructure, aviation and automotive companies around the world. In the Mobility segment, the companyâs solution includes a web portal for mobility solutions, Auto parts and accessories, Car services and eBike Systems. For the purpose of Home utilisations, the company engages in the development of products such as Garden Tools, Heating and Hot Water systems, Home appliances, as well as âDo it Yourselfâ power tools. The companyâs flagship segment is the Industry and Trades segment, through which it provides products and services such as Business Process Outsourcing Solutions, Drive and Control Technology, Energy and Building Solutions, Large Thermal Plant and Systems Solutions, Safety and Security Solutions as well as Software Solutions.
Ceres Power Holdings Plc Background
Ceres Power Holdings Plc (LON:CWR) is a fuel cell technology and engineering company which seeks to spread its technology in mass-market energy products for various markets. The company develops and commercialises its fuel-flexible SteelCell® technology for applications such as combined heat and power for commercial and residential sectors, which has enabled the company to establish itself in major markets like Japan, Korea and the USA. Boschâs flagship SteelCell® technology has proven to be capable of generating energy from green fuels such as natural gas as well as through sustainable fuels and is extremely efficient when accomplishing tasks. This technology finds application in industries such as commercial power space, Transportation, Data Centres, and for residential purposes as well.
Boschâs stake increase in Ceres Power Holdings
As detailed earlier, Ceres Power Holdings Plc issued a press release on 22nd January 2020, announcing that Bosch had increased stake in the company from 4 per cent to around 18 per cent. The transaction was completed at a consideration of â¬77.3 million by combining new and existing shares at a price of â¬3.20 per share. Another investor in the company, Weichai, has the anti-dilution rights, to invest â¬11.2 million, for the purpose of maintaining its existing stake of around 20 per cent in the company. The company reported that, since April 2018, when this partnership was first established, they have had a successful collaboration in terms of the development of fuel-cell stacks for stationary power applications.
The company reported that the proceeds would primarily be used for the purpose of the development of high power systems, and to expand the manufacturing capacity from 2 Megawatt to 3 Megawatt by the end of 2020. The company also intends to make investments in business development activities with the help of the proceeds generated from this transaction. Another application of the fund for the company is building of the balance sheet so that they can make strategical acquisitions in the future that can support the growth of its existing technology. The company also highlighted the fact that this increase in the stake points out to Boschâs commitment to the association between the two companies and its intention to have additional collaboration towards potential future scale-up and mass manufacturing of the companyâs technology.
CWR Share Price Performance
(Source: Thomson Reuters) Daily Chart as on 22-January-20, before the closing of the LSE Market
On 22nd January 2020, at around 01:35 P.M (Greenwich Mean Time), at the time when this report was being written, Ceres Power Holdings Plcâs share price was reportedly at GBX 367.00 per share on the London Stock Exchange market, a jump in the price of 5.76 per cent or GBX 20.00 per share, as opposed to the last trading dayâs closing price, that was reportedly at GBX 347.00 per share. The market capitalisation of Ceres Power Holdings Plc was reported to be at £534.20 million with regards, to the price at which the companyâs share was trading at the time of writing.
The companyâs share has depicted a positive change of around 115.50 per cent, in the year gone by, from the price of GBX 170.30, at which the companyâs share was trading last as on January 22, 2019. The Ceres Power Holdings Plc share has also given a positive return in the last six months, of approximately 81.68 per cent compared to the share price of GBX 202.00 which was set by Ceres Power Holdings Plcâs share as on July 22, 2019. The companyâs share has also given a positive return of around 52.92 per cent, in last one monthâs time from the share price of GBX 240.00 per share that the share achieved at the close of the market on December 23, 2019.
The companyâs stock beta was reported at a value of 0.84, giving an idea that the Ceres Power Holdings Plcâs share has been slightly less fickle in nature, in comparison to the sensitivity of the comparative benchmark index in the previous year.
Stock Price Performance of other major players in the segment
PPS Share Price Performance
On 22nd January 2020, at around 01:40 P.M (Greenwich Mean Time), at the time when this report was being written, Proton Motor Power Systems Plcâs share price was reportedly at GBX 44.50 per share on the London Stock Exchange market, an upside in the price of 20.27 per cent or GBX 7.50 per share, as opposed to the last trading dayâs closing price, that was reportedly at GBX 37.00 per share.
The market capitalisation of Proton Motor Power Systems Plc was reported to be at £248.07 million with regards, to the price at which the companyâs share was trading at the time of writing.
The companyâs stock beta was reported at a value of 1.83, giving an idea that the Proton Motor Power Systems Plcâs share has been fickle in nature, in comparison to the sensitivity of the comparative benchmark index in the previous year.
QXT Share Price Performance
On 22nd January 2020, at around 01:45 P.M (Greenwich Mean Time), at the time when this report was being written, Quixant Plcâs share price was reportedly at GBX 206.00 per share on the London Stock Exchange market, a jump in the price of 0.98 per cent or GBX 2.00 per share, as opposed to the last trading dayâs closing price, that was reportedly at GBX 204.00 per share.
The market capitalisation of Quixant Plc was reported to be at £135.53 million with regards, to the price at which the companyâs share was trading at the time of writing.
The companyâs stock beta was reported at a value of 0.29, giving an idea that the Quixant Plcâs share has been less fickle in nature, in comparison to the sensitivity of the comparative benchmark index in the previous year.
SMS Share Price Performance
On 22nd January 2020, at around 01:50 P.M (Greenwich Mean Time), at the time when this report was being written, Smart Metering Systems Plcâs share price was reportedly at GBX 552.50 per share on the London Stock Exchange market, a jump in the price of 2.13 per cent or GBX 11.50 per share, as opposed to the last trading dayâs closing price, that was reportedly at GBX 541.00 per share.
The market capitalisation of Smart Metering Systems Plc was reported to be at £610.21 million with regards, to the price at which the companyâs share was trading at the time of writing.
The companyâs stock beta was reported at a value of 0.56, giving an idea that the Smart Metering Systems Plcâs share has been less fickle in nature, in comparison to the sensitivity of the comparative benchmark index in the previous year.
Comparative Stock Price Chart of PPS, QXT and SMS
(Source: Thomson Reuters) Daily Chart as on 22-January-20, before the closing of the LSE Market
