Pure Hydrogen welcomes investment in H2X Global from VerdeMobility

Pure Hydrogen (ASX: PH2) has welcomed the receipt of international funding support for its part-owned subsidiary H2X Global.

Under a new funding agreement, VerdeMobility and H2X have signed a term sheet under which Verde will invest an initial amount of $5.1 million in equity funding into H2X.

The agreement includes an option for H2X to accept up to $86.2 million in funding, over the 2023 to 2024 period, subject to operational milestones.

US headquartered VerdeMobility is a specialist in mobility and power generation products.

H2X is planning to utilise the VerdeMobility cornerstone equity investment to finance the delivery of approximately $39 million in vehicle orders while supporting its continued growth plans, which include a proposal to list on the London Stock Exchange in the near term.

Under new capital injection agreement, Pure Hydrogen’s equity interest in H2X will be diluted.

However, the final figure will not be known until the size of the drawdown over the 2023/24 financial year period is revealed.

Pure Hydrogen managing director, Scott Brown, said that upon completion of the initial transaction, Pure Hydrogen’s equity interest would be around 17%.

The company also has a distribution agreement with H2X to sell hydrogen fuel cell vehicles and hydrogen fuel cell generators once they are commercially available.

Strong investor interest

“We are pleased to see strong investor interest in H2X and hydrogen fuel cell electric technology. H2X are leading the market in the light to medium commercial vehicle segment, and this investment positions them well in growing their European manufacturing capability and servicing customers in that region,” Mr Brown said.

“Pure Hydrogen made a strategic equity-funded investment in H2X over two years ago to facilitate the supply of hydrogen fuel cell electric vehicles. While we consider our investment in H2X to be consistent with our investment philosophy today, their addition of a cornerstone investment partner will require them to focus their efforts on growing market share in Europe.”

Change of focus for H2X

Mr Brown said that while much of H2X’s future focus will be on Europe, his company was still happy with their relationship.

“Pure Hydrogen is firmly focused on providing turn-key hydrogen solutions including the supply of green, emerald and turquoise hydrogen to the Australian marketplace along with devices that use the hydrogen.”

“Pure Hydrogen has made an investment with Hdrive International to secure an excellent range of high-quality hydrogen fuel cell trucks and buses which will allow us to offer great solutions to customers from Australia and around the world. With H2X’s near term focus now centred on the European market, we are comfortable with the potential dilution of our shareholding in H2X.”

Hdrive interest secured

In late July Pure Hydrogen revealed it would form a new venture company with the main shareholders of Hdrive, a leading supplier of zero-emissions vehicles in Australia and New Zealand.

Pure Hydrogen will hold a 60% controlling interest in Hdrive International.

Hdrive recently grabbed industry attention with the launch of Pure Hydrogen’s Taurus truck, the first hydrogen fuel cell prime mover in Australia.

Hdrive has also been active in delivering hydrogen fuel cell refuse collection vehicles to be trialled by JJ Waste & Recycling, the largest privately-owned waste management company in Australia.