Plug Power Buys General Hydrogen

May 1, 2007
Plug Power Inc. (Latham, N.Y.), a fuel cell developer, has acquired General Hydrogen Corp. (Richmond, B.C.), a supplier of fuel cell power units that

Plug Power Inc. (Latham, N.Y.), a fuel cell developer, has acquired General Hydrogen Corp. (Richmond, B.C.), a supplier of fuel cell power units that provide motive power for electric lift trucks and other mobile industrial equipment. Plug Power paid $10 million, consisting of approximately $7 million in cash and the assumption of $3 million in debt.

General Hydrogen is located in close proximity to Cellex Power Products, Inc., another supplier of fuel cell power solutions for electric lift trucks, which Plug Power acquired last month. Plug Power plans to integrate the two companies into one operation managed by Chris Reid, Cellex Power’s current president.

“By acquiring both General Hydrogen and Cellex Power, clear leaders in their industry, we expect to realize significant technology and operational synergies as we pursue high-value applications in the material handling market,” said Dr. Roger Saillant, Plug Power’s president and CEO. “Further, we anticipate that higher volume commercial product manufacturing activities will be established in Plug Power’s Latham, N.Y. facility.”

General Hydrogen’s initial product focus has been on the larger class-1, sit-down lift trucks that are typically used in manufacturing operations. Cellex Power has focused on class-3 rider pallet trucks, which are primarily used to transport and select goods within large distribution centers before delivery to retail stores. Both companies were developing fuel cell power units for class-2, stand-up reach trucks.

“We intend to leverage Plug Power’s existing commercial infrastructure and expect to avoid some of the expenditures typically associated with the transition from a pre-commercial to commercial enterprise,” said Dr. Saillant. “Given Plug Power’s financial and operational strength and the combined fuel cell expertise of the three companies, we expect to accelerate product development for all three classes of electric lift trucks. This enhanced scale and breadth of applications will increase the economic value delivered to our customers while improving our ability to realize meaningful sales volumes.”

Coincident with the acquisition of General Hydrogen, Plug Power has entered into a two-year agreement with Ballard Power Systems Inc. (Burnaby, BC)for the purchase of fuel cell stacks for electric lift truck applications, replacing the previous agreement between General Hydrogen and Ballard. The General Hydrogen and Cellex Power products were designed around the Ballard stack and have reportedly generated tens of thousands of operating hours to validate reliability and performance. Under the new agreement, Plug Power and Ballard will work together to drive reliable, low-cost solutions that are expected to significantly improve the outlook for fuel cell commercialization of material handling applications.

Source: Plug Power