HydrogenOne Capital Growth announces placing to fund immediate £45m pipeline – HydrogenOne Capital Growth (HGEN) has announced a placing of new ordinary shares in the company at a price of 100 pence per share, representing an attractive discount to the prevailing share price and a premium to the latest NAV per share as at 31 March 2022.
The placing, which is being conducted by way of an accelerated bookbuilding process to qualifying new and existing investors, is intended to satisfy short term institutional market demand for shares utilising the authorities granted at the time of HGEN’s IPO.
The manager has identified a substantial pipeline, in excess of £500m, of private hydrogen assets including a near term pipeline in excess of £200m undergoing advanced due diligence. The placing will provide additional funding for the immediate term pipeline under exclusivity which has an aggregate value of approximately £45m.
Furthermore, the board are also actively considering the implementation of a share issuance programme in the near term which will allow the company to satisfy market demand for ordinary shares over a period of time to increase the size of HGEN and invest in the pipeline.
Substantial and long term shifts are underway in the energy system, which underpin the clean hydrogen sector, as follows:
Climate change: In the aftermath of the 2016 Paris Agreement, governments and companies are beginning to implement plans to decarbonise industrial hydrogen, and use clean hydrogen to displace fossil fuels, to mitigate climate change. By the beginning of 2022, over 39 countries had published hydrogen roadmaps, over 500 clean hydrogen projects have been announced. A 200x increase in clean hydrogen supply is anticipated from 2019 to 2030, as the scale-up of renewable power alongside the phase-out of fossil fuels takes effect. The Investment Adviser believes that clean hydrogen supply could represent over US$1 trillion in annual sales by 2040 and potentially US$2.5 trillion in 2050.
Poor air quality is resulting in over 4 million premature deaths per year. Clean hydrogen has a key role in replacing fossil fuels in heavy transport sectors and power generation.
Energy security: As recent tragic events in Ukraine have shown, over-reliance on relatively few sources of energy can result in high prices for customers and risks to predictable energy supplies. Clean hydrogen, alongside large scale renewables, offers a viable pathway for distributed and hence de-risked energy supply.
The placing
The Placing will be non-pre-emptive and the number of New Ordinary Shares will be determined at the close of the Bookbuild which is expected to close at 3:30 p.m. on 7 April 2022. The results of the Placing will be announced shortly thereafter.
Under the terms of the Placing, the Company intends to issue up to 21,469,999 New Ordinary Shares, under authority granted by resolutions passed on 20 May 2021. The New Ordinary Shares will, when issued, be credited as fully paid and will rank pari passu in all respects with the existing issued ordinary shares in the capital of the company.
HGEN : HydrogenOne Capital Growth announces placing to fund immediate £45m pipeline