French carmaker Renault and US hydrogen specialist Plug Power have joined forces to develop hydrogen-powered light commercial vehicles (LCV), they said on Tuesday.

The companies have signed a memorandum of understanding to launch a France-based 50-50 joint venture by the end of June, targeting a more than 30% share of the fuel cell-powered LCV market in Europe, a joint statement said.

The news sent shares in Plug Power up by about 16% to a multi-year high of $62.65. The stock traded at little more than $3 at the end of 2019. Renault shares rose just over 2%.

The joint venture will combine Renault’s vehicle manufacturing capabilities with the fuel cell and hydrogen system manufacturing knowledge of Plug Power, establishing a fuel cell stack and system manufacturing centre in France for integration into LCV platforms.

The centre will also provide hydrogen refuelling systems.

Plug Power, which has a market value of more than $25 billion, says it has deployed over 40,000 fuel cell systems for e-mobility, more than anyone else in the world, and has become the largest buyer of liquid hydrogen.

Renault, with a market value of over $13 billion, sold close to 3.8 million vehicles in 134 countries in 2019. It has 40 manufacturing sites, and employs more than 180 000 people.

Santander acted as Plug Power’s sole financial adviser.