Thyssen-Krupp plans to list its hydrogen subsidiary Nucera this Friday.
(Photo: Reuters)
Frankfurt Thyssen-Krupp Nucera started trading with a slight price gain. Nucera shares rose on Friday morning and were quoted at EUR 20.20. The hydrogen subsidiary of the industrial group made its start on the Frankfurt stock exchange floor this Friday.
The shares were issued for 20 euros each, the issue price is roughly in the middle of the range on offer. Thyssen-Krupp Nucera is thus valued at 2.53 billion euros.
It is the first new issue on the Frankfurt Stock Exchange for about six months. The IPO raises Nucera EUR 605 million, including an over-allotment option. 526 million euros of this sum will go to Nucera. The company wants to use them to expand the business with the technology for producing hydrogen.
Investors had recently lost money with many new issues, and the prices of hydrogen companies in particular are currently under pressure. The company is optimistic: “We have noticed a strong revival in the market and the volatility index has fallen well below 20,” says Thyssen-Krupp Nucera’s CFO, Arno Pfannschmidt, to the Handelsblatt. Although the market environment is challenging, the timing is still right for Nucera.
Not only is the issue price in the middle of the range. Together with the Saudi state fund Public Investment Fund (PIF), which takes over six percent of the shares, and the Paribas Energy Transition Fund with 3.5 percent, two cornerstone investors have been found that provide stability. “This is a strong signal to other market participants that we are getting the full book. We have a higher demand than we can serve,” says Pfannschmidt.
Thyssen-Krupp wants to retain majority
Above all, the long experience in the construction of chlor-alkali electrolysis plants creates trust for the electrolysis business with hydrogen. Nucera has already installed more than 600 of the systems worldwide. The chlorine produced is used, for example, to purify drinking water or as a base material for chemical companies.
Thyssen-Krupp wants to reduce its stake to 50.2 percent as part of the IPO. Thyssen-Krupp currently holds 66 percent of the shares in Nucera, while the remaining 34 percent are held by Italian partner De Nora. 24 percent will be in free float in the future.
>> Read here: Demand for IPO of Thyssen-Krupp subsidiary exceeds supply
The hydrogen subsidiary develops technology for electrolysis plants that can be used to produce green hydrogen on an industrial scale. Nucera’s business is currently focused on Europe and North America. The company states that the growth opportunities in the USA are particularly good as a result of the massive subsidy as part of the Inflation Reduction Act (IRA).
Thyssen-Krupp actually wanted to list the subsidiary last year. However, due to the volatile market conditions, the group initially refrained from these plans.
In the current situation, the large investments that Nucera intends to make in the coming years could not have been shouldered by the group alone. Because in order to assert itself internationally against competitors, Nucera has to expand: The hydrogen subsidiary expects high expenses for research and development. By 2026, between 150 and 250 million euros are to be invested in research and a similar amount in further investments – a total of around 500 million euros will be needed for this.
Few new issues in Germany
The planned IPO of Thyssen-Krupp Nucera is the second major IPO this year in Germany. However, the debut of the Internet service provider Ionos flopped in the spring – the market environment is currently considered challenging despite the recent highs on the Dax.
Investors remain cautious about new issues. No further deals are planned in Germany for the summer. Bankers are expecting a handful of IPOs in the fall, such as glass packaging manufacturer Schott Pharma or armored gear manufacturer Renk.
More: Here’s what you need to know about Nucera stock