Thyssen-Krupp plans to list its hydrogen subsidiary Nucera this Friday.
(Photo: Reuters)
Frankfurt Thyssen-Krupp Nucera started trading with price gains. Nucera shares opened at EUR 20.20 in the morning and then rose to EUR 23.28 in the early afternoon. The shares were issued for 20 euros each. The hydrogen subsidiary of the Thyssen-Krupp industrial group was valued at 2.53 billion euros in the deal.
It is the first new issue on the Frankfurt Stock Exchange since February. The proceeds from the IPO add up to around EUR 605 million, including an over-allotment option, of which EUR 526 million will go directly to Nucera. The company plans to use the money to expand its hydrogen production technology business.
Investors had recently lost money with many new issues, and the prices of many hydrogen companies are currently under pressure. Stocks of companies such as French Haffner Energy, Norway’s Nel Asa, British ITM Power and American Plug Power have lost between 20 and 75 percent. The exception is the Italian Nucera shareholder De Nora, whose shares have increased by half in the past year.
Thyssen-Krupp’s CEO Miguel Ángel López Borrego enthused at the stock exchange ceremony with the traditional ringing of the bell at the appearance of the first price that the Nucera IPO could be compared to the moment of the moon landing.
For Thyssen-Krupp it is the first IPO of a subsidiary. “A few years ago, today’s Nucera was an enchanted princess. Today it is a multi-billion dollar business. The enchanted princess has become a unicorn,” he says. Unicorns are companies with a valuation of more than one billion.
Nucera benefited from a good market environment. The Dax had given way after records in June. However, the volatility is still below the index value of 20. From the age of 25, IPOs are considered a challenge.
Nucera CFO Arno Pfannschmidt told Handelsblatt that demand for the shares was higher than the company was able to serve. Another contributing factor was that the Saudi state fund Public Investment Fund (PIF), which is taking over six percent of the shares, and the Paribas Energy Transition Fund with 3.5 percent, two cornerstone investors who provide stability were found.
Thyssen-Krupp wants to retain majority in Nucera
According to Pfannschmidt, the long experience in the construction of chlor-alkali electrolysis plants in particular 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 reduced its stake to 50.2 percent in the course of the IPO. Before that, Thyssen-Krupp held 66 percent of the shares in Nucera, while the remaining 34 percent were held by Italian partner De Nora. 24 percent are now in free float.
>> 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. Because of the volatile market conditions, the group initially backed down.
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.
Nucera IPO: Only a few new issues in Germany
The 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.
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. In addition, the German sandal manufacturer Birkenstock has started preparations for an IPO in the USA.
More: Here’s what you need to know about Nucera stock