Australian clean energy company Pure Hydrogen (ASX: PH2) has entered into a new venture with the main investors of Australia and New Zealand zero-emissions vehicles supplier HDrive International.
The terms of the deal will see Pure Hydrogen secure a 60% controlling interest in HDrive and have access to global distribution rights under a new distribution agreement which will expand HDrive’s footprint to international markets.
Pure Hydrogen will be assigned the existing loans and obligations of HDrive, which currently amount to approximately $2.2 million.
To obtain its 60% equity, Pure Hydrogen will issue shares equivalent to the value of the loans and obligations outstanding, with the price per share being calculated using a five-day volume weighted average price.
Existing HDrive investors will collectively hold the remaining 40% equity and the new entity will retain the same management team to maintain business continuity and momentum.
Post transaction, Pure Hydrogen will invest additional working capital into HDrive to help fund its future development and distribution initiatives, which will be dependent on sales figures.
The company is in discussions with potential funders with a view to putting a facility in place in the near term.
HDrive is acting as Pure Hydrogen’s procurement partner for the Taurus hydrogen fuel cell prime mover, which will be the first vehicle of its kind in Australia developed on behalf of PepsiCo.
HDrive is managing the Taurus build and delivery process.
It is also in the final stages of delivering Australia’s first hydrogen fuel cell refuse collection vehicle to be trialled along the Gold Coast by waste management company JJ Waste & Recycling.
Pure Hydrogen managing director Scott Brown said the new venture is consistent with a business strategy to become the lowest-cost hydrogen supplier of choice through the provision of reliable turnkey transport solutions.
“HDrive has established a strong team and partner networks in the process of growing its operations into what is now a leading distribution and development business for hydrogen vehicles in Australia and abroad… it has an impressive suite of Australian-designed hydrogen trucks and buses manufactured with some of the best components in the industry,” he said.
“We are confident that our investment will further develop the HDrive business into a market leader in hydrogen vehicles and that will also help drive demand for our broader hydrogen business… this is an exciting chapter for the HDrive brand and we look forward to delivering high performing, cost-competitive, reliable hydrogen fuel cell solutions to our customers alongside as part of this venture.”