16 May 2018 – King & Wood Mallesons’ cross-border team advised Weichai Power ("Weichai") one of China’s leading automobile and equipment manufacturing companies, with a market capitalization around ¥ 85 billion, producing 600,000 engines per year, on its entering into equity investment and framework agreements with AIM listed Ceres Power, a world leading developer of fuel cell technology including its unique patented SteelCell® technology.
Weichai will acquire equity interest and warrant rights in Ceres Power and the parties will jointly develop and launch a Solid Oxide Fuel Cell (SOFC) range extender system for China's fast growing electric powered bus market. The framework agreement includes the joint development and licensing of general manufacturing system in the Chinese commercial vehicle and generator market. The parties will also establish a JV in Shandong to manufacture and sell fuel cell systems. Weichai will need to obtain relevant PRC regulatory approvals and the transaction is subject to Ceres’ shareholders approval.
KWM’s cross border-team was led by Beijing-based cross-border M&A partner Xu Ping and London-based corporate partner Greg Stonefield. China team members include associates Yao Ping, Mark Fu and Charlie Zhu, while London corporate team members are composed by partners Joseph Newitt and Barri Mendelsohn, and associates Gonca Caliskan and Jushan Wang.
Xu Ping comments: “We are extremely pleased to have advised our long-term client Weichai Power on this strategic collaboration into the new energy sector. The transaction encompasses a number of important commercial arrangements, including equity investment, joint development, license agreement as well as formation of a joint venture. KWM China and Europe team have been working closely in assisting the client on the structure, documentation and implementation of the transaction.”
Wang Rongkang, Managing Partner of KWM EUME, said: “We are delighted to support our clients in strategic collaborations around the world including Europe. We are currently working on several agreements and strategic investments between China and UK companies across a number of industries and sectors from manufacturing, mining and resources, renewables, clean tech and pharmaceuticals to service orientated ones. We are seeing a lot of market opportunities and successful collaborations, and we are pleased to support our clients in these exciting markets.”
Greg Stonefield said: “Our Chinese clients value the strength of our global practice, cross-border M&A capabilities as well as the seamless cooperation between our teams and offices around the globe, particularly in strategically important industries, and we are pleased to assist them in their growth and collaborations in international markets.”