Last Friday afternoon’s announcement by Ceres Power Holdings Plc (LON:CWR) that the successful £20m equity fundraise has been approved at EGM is excellent news for the company. It is the next key step in the commercialisation of its world-class, Ceres Steel-cell platform into a number of micro combined heat and power (‘m-CHP’) and power-only markets, with blue-chip OEM partners. In recent months Ceres has announced new and extended exciting commercial Joint Development Agreements (‘JDAs’) with Honda in the power products market, Nissan in the automotive market and Cummins in the higher-power module exploding data centre market. These are in addition to existing agreements in a number of residential m-CHP markets. This equity raise strengthens Ceres’s balance sheet, and hence commercial position, in expectation of a number of these agreements being negotiated up to full commercial contracts and subsequent product launches.
Ceres complete successful £20m equity fundraise with high-quality institutional investors. On Friday afternoon Ceres Power Holdings Plc announced the successful completion of a £20m equity fundraise, with the transaction being approved by shareholders at EGM. The equity capital came from blue chip institutional investors, both existing shareholders and new entrants and is excellent news for Ceres. This is a key step in the execution of the company’s commercialisation strategy, providing the capital to fund the business through to a commercial position of strength.
Fundraise provides balance sheet strength for next stage of commercialisation with OEM partners. The recent £20m equity fundraise by Ceres was timed to provide the necessary balance sheet strength ahead of a key stage of the company’s commercialisation strategy. Ceres has engaged in JDAs with a number of blue-chip OEM partners in various verticals, including Honda in power products, Nissan in automotive and Cummins in data centres, as well as existing agreements in a number of residential m-CHP markets. For some of these OEM partnerships, the next key stage is the progression of the existing JDAs into full commercial contracts. Ceres has a management team with expertise in negotiating these type of deals, particularly in Asia, and they now have the balance sheet behind them to maximise value for Ceres and its shareholders.
Fundraise is a strong indication of the quality of Ceres’s world-class technology platform, business model and management team. The fact that Ceres has executed a high-quality equity fundraise in challenging market conditions, when it is yet to move into profitability is testament to the quality and potential of its world-class technology platform, the validity of its business model and the competence of its management team