SFC Energy AG, a leading provider of H₂ and methanol fuel cells for stationary, portable and mobile hybrid power solutions, has, together with its newly established Danish subsidiary SFC Energy Denmark ApS (SFC Denmark), entered into an agreement with Ballard Power Europe Systems A/S (BPSE) to acquire selected assets from the small stationary H₂ fuel cell business in Scandinavia, including IP rights and (subject to customer consent) customer contracts. BPSE is a subsidiary of Ballard Power Systems Inc., a pioneer in proton exchange membrane fuel cells (PEM fuel cells/PEMFC) headquartered in Vancouver, Canada. The purchase price is in the low single-digit million Euro range.

With this transaction, SFC is expanding its own power range with two proven H₂ fuel cell solutions with an output of 1.7 kW and 5 kW. As with SFC's existing EFOY energy solutions, the standardized design allows multiple fuel cell modules to be clustered. In addition to the existing BPSE customer base, the promising sales pipeline is also part of the transaction. The maintenance contracts for BPSE's existing installed base of around 400 sites, mainly located in the Northern European countries of Denmark, Norway, Sweden and Finland, will also be acquired, subject to customer consent. Furthermore, as part of the transaction, SFC Denmark will offer future employment to selected BPSE employees who are key knowledge holders and, while working at BPSE, spend the majority of their working time on matters relating to the relevant small stationary H₂ assets.

SFC is actively driving market consolidation by acquiring assets for stationary H₂ fuel cell solutions in the power range below 50 kW. The installed base and the associated established customer relationships form a solid foundation for further expansion in Northern Europe followed by other regions. This is being accelerated by the establishment of SFC Denmark for sales, service, application engineering, and assembly. Whereas research and development, as well as manufacturing, will be integrated into SFC’s existing organizations in Germany and Romania.

The acquisition is in line with SFC's overarching growth strategy, which is based on three pillars: (1) Market penetration and international expansion, (2) technology and IP development, and (3) complementary M&A activity.

The SFC Management Board expects the new business to generate revenues in the mid-single-digit million Euro range and a positive contribution to EBITDA and EBIT starting in 2025.

Dr Peter Podesser, CEO of SFC Energy AG said, “By integrating Ballard Power Systems' expertise in this power range into our product portfolio, we will be able to offer our combined customer base the most comprehensive range of stationary fuel cells below 50 kW worldwide. Based on long-term service agreements we aim to accelerate regional market access in the dynamic Northern European market and other regions to follow. In addition, we are securing important intellectual property and have the opportunity to welcome highly experienced fuel cell experts to our team. The transaction thus contributes to various elements of our defined and consistently pursued growth strategy. The challenge now is to realize the addressable market potential, which we estimate to be well over 1,000 locations in Northern Europe in the first phase and to realize synergies along the entire value chain. We are looking forward to expanding our partnership with Ballard as a trusted stack supplier. For us at SFC Energy, this is another important milestone in contributing to decarbonization and further promoting the spread of H₂ fuel cell technology.”

Randy MacEwen, CEO of Ballard Power Systems Inc. said, “We have served as a long-standing supplier of PEM fuel cell stacks to SFC for some of its H₂-based stationary power products. During this time, we have developed trust in SFC’s business strategy, team and technical capabilities. We believe the consolidation by SFC Energy of our proven 1.7 kW and 5 kW PEM fuel cell solutions into their growing product portfolio of low-power H₂ fuel cells in the stationary power markets will provide significant value for our existing customer base. We at Ballard are confident that SFC will successfully build on our work, and we look forward to continuing to serve SFC as a trusted stack supplier.”

The transaction, which is subject to obtaining requisite regulatory approval, is expected to close within 2024.