Plug Power has today said it is pursuing transactions to acquire United Hydrogen and an electrolyser technology platform to enhance its capabilities in hydrogen generation, liquefaction and logistics business.
The New York-based company is in advanced negotiations to acquire United Hydrogen, and currently owns a convertible bond the company, which could represent over 30% equity ownership on a converted basis. If successful, the acquisition is expected to be accretive immediately.
United Hydrogen current produces 6.4 tonnes of hydrogen daily and has plans to increase this to 10 tonnes per day in the near future. The produced hydrogen has a low carbon footprint and uses by-product hydrogen from chlor alkali plants.
“Plug Power will continue to work with its existing suppliers and also look to build more strategic partnerships as the company’s demand for hydrogen is expected to increase sustainability,” said Andy Marsh, Plug Power CEO.
“Plug Power projects its hydrogen demand to increase four-fold to over 85 tonnes of hydrogen a day by 2024 – up from over 27 tonnes per day today. In addition, the company plans for over 50% of that to be green hydrogen.”
“In line with the green hydrogen strategy, Plug Power is also pursuing the acquisition of an electrolyser company. If the acquisition is completed, this technology platform is expected to provide Plug Power access to a range of electrolyser products from 100kW to 1MW+.”
“Plug Power has a growing pipeline of opportunities with its customers where the value proposition works well with electrolyser technology today. This technology is expected to allow for Plug Power to expand its addressable market opportunity into other industrial applications.”
“We expect that both of these acquisitions would provide Plug Power with comprehensive skill sets in the entire hydrogen value chain and pave the way for going from low-carbon to zero-carbon as we continue to focus on building the hydrogen economy.”
Plug Power has not yet entered into a definitive acquisition agreement with either acquisition target and both transactions are subject to the completion and execution of customary definitive documents and satisfaction of customary closing conditions.
While Plug Power cannot guarantee that either acquisition will be completed, based on the current state of negotiations and transaction process, the company expects both acquisitions can be completed by the end of the second quarter 2020.