Fortescue said it had signed a share sale and purchase agreement to acquire the company from private equity firm EMK Capital and Williams Grand Prix Engineering.
WAE will be vertically integrated into Fortescues' business and will be managed by its green energy arm, Fortescue Future Industries.
The company said it has worked closely with the firm since early 2021 to design and build a prototype battery system to power its electric mining haul truck.
Fortescue said the acquisition will provide the critical technology expertise to help it decarbonise its mining fleet in order to reach net-zero emissions across scopes 1 and 2.
The merged entity will develop battery electric solutions for Fortescue's rail, mobile haul fleet and other heavy mining equipment, as it looks to cut its diesel usage, as well as grow WAE's green technology and engineering business.
One of the first major projects to be developed will be a battery-electric train concept, which Fortescue said it would announce further details later in the year.
Earlier this month FMG announced it had purchased two battery electric locomotives from Progress Rail.
Fortescue chairman Dr. Andrew Forrest described the acquisition as a major milestone.
"FFI and WAE will work together to decarbonise Fortescue - and in turn the global heavy industry and hard-to-abate sectors - for the good of our planet and the benefit of our shareholders," he said.
"Today's announcement builds on our commitment to remove fossil fuel powered machinery from our operations and to replace it with zero carbon emission technology, powered by FFI green electricity, green hydrogen and green ammonia."
Fortescue noted WAE has a demonstrated track record with Tier 1 customers in advanced engineering across automotive and motorsport sectors with a revenue of around US$84 million in 2021.
The company started up in 2010 when Williams Grand Prix Engineering began diversifying its operations, a division that later became WAE.
"High performance battery and electrification systems are at the core of what we do at WAE and this acquisition and investment will facilitate the company's further growth to support the delivery of zero emission products and services across existing sectors…and new sectors too," WAE CEO Craig Wilson added.
"We are delighted to play a key role in Fortescue's decarbonisation strategy, contributing to the delivery of their emissions reduction targets through high performance battery systems, green hydrogen and related technologies."
Fortescue said WAE would continue to service its customers while rapidly expanding its electrification technologies, engineering and manufacturing offerings.
Fortesuce will establish an advisory board to guide the company, and has appointed its lead independent director, Mark Barnaba to the board.
The acquisition will be funded from Fortescue's existing liquidity sources, with the deal expected to complete in March.
"Rapid growth of WAE's world-leading technology and engineering business and an expansion of its manufacturing footprint further enhances FFI's position to become a major player in the global market for decarbonisation of the global heavy industry sector," outgoing FMG CEO Elizabeth Gaines said.
"Joining the Fortescue Family will also allow WAE to invest in new technologies and to further commercialise world leading electrification products in new markets."
