Cummins Inc. has entered into a definitive agreement to acquire, through a wholly owned subsidiary, all the issued and outstanding shares of fuel cell systems provider Hydrogenics Corp. for $15 per share in cash, other than shares already owned by The Hydrogen Co. Total enterprise value for the deal is approximately $290 million. Following the unanimous recommendation of the special committee of Hydrogenics board of directors, all non-interested directors of Hydrogenics have unanimously approved the transaction and recommends that Hydrogenics shareholders vote in favor of the transaction.
“We are excited that Cummins has reached an agreement with Hydrogenics to welcome the employees and innovations of one of the world’s leading fuel cell and hydrogen generation equipment providers to our company,” said Tom Linebarger, chairman and CEO, Cummins Inc. “We look forward to partnering closely with Hydrogenics’ team in the coming weeks as we work toward closing the transaction. Upon closing, we will share more details about the acquisition and our strategy to offer a broad portfolio of power solutions to meet our customers’ needs.”
“It takes vision and an innovative spirit to take on next generation technologies and provide the environment for them to grow,” said Daryl Wilson, president and CEO, Hydrogenics. “Hydrogenics has worked for 24 years to emerge as a global leader in fuel cell and hydrogen solutions in the power industry. We are deeply honored to now join with Cummins on the transformative journey of next generation clean power solutions.”
As a part of the transaction, The Hydrogen Co., a wholly-owned subsidiary of L’Air Liquide, S.A., and Hydrogenics’ current largest equity shareholder, will maintain its ownership in Hydrogenics.
The closing of the acquisition is subject to the satisfaction of customary closing conditions for a court approved Plan of Arrangement transaction in Canada, including, without limitation, receipt of court approval pursuant to the Canada Business Corporation Act and the approval of at least 662/3% of the votes cast by shareholders of Hydrogenics as well as the approval by at least 50% of the votes cast by disinterested shareholders, which excludes The Hydrogen Co. The transaction is expected to close in the third quarter of 2019.
Morgan Stanley & Co. LLC is serving as financial adviser, and Gowling WLG (Canada) LLP and Barnes & Thornburg LLP are serving as legal counsel to Cummins.