AP Ventures is investing $4m in Australian hydrogen producer Hazer.
The London-headquartered company manages venture capital funds with a global mandate to invest in pioneering new technologies and businesses which aim to solve global challenges.
AP Ventures portfolio is concentrated in the hydrogen sector, with its investments supporting companies through their commercialisation and scale up phases.
Hazer’s Commercial Demonstration Project (CDP) will see the Australian company produce low-emission hydrogen and graphite from sewage at a wastewater treatment plant in Munster.
The three-year operation at Woodman Point Wastewater Treatment Plant will produce around 100 tonnes of fuel cell-grade hydrogen, capable of use as a low-emission transport fuel, for power generation or in clean industrial applications, and 380 tonnes of graphite each year, with the potential for expansion.
Under the proposed agreement between the two companies, AP Ventures (APV) will invest $4m in Hazer in return for four million unlisted notes and 2.25 million unlisted options in Hazer.
The notes, while unsecured, have a term of five years and will be converted to ordinary Hazer shares at the five-day volume-weighted average price of Hazer shares at the time of conversion. The notes have a 20-cent floor price.
The conversion of the notes are restricted to a maximum of $1.33m in one go and no notes can be converted in the first 12 months from issue, according to the term sheet.
Similarly, the options last five years and can’t be exercised within the first 12 months from issue. They give APV the right to buy 2.25 million ordinary Hazer shares for a nominal consideration.
Tim Goldsmith, Chair of Hazer Group, commented, “The Board and I believe that APV’s deep global hydrogen experience will be extremely valuable as we commercialise the Hazer process and progress through scale-up and first commercial operations over the next few years.”
“There is significant global focus on the transition to cleaner energy and cleaner industry, a focus that has accelerated as major economies look to transition from the impact of Covid-19. We expect hydrogen to play a major role in this.”
Andrew Hinkly, Managing Partner of AP Ventures, said, “The production of low-carbon and low-cost hydrogen is the key to unlocking the global hydrogen economy and we believe Hazer’s technology offers a unique and elegant solution.”
“We are very impressed with the team at Hazer and are pleased to be part of the journey as the company scales and commercializes its innovative technology.”