AFRICA – FiveT Capital Holding, an independent asset manager, has launched a private infrastructure fund, FiveT Hydrogen Fund, dedicated to delivering clean hydrogen infrastructure projects at scale.
The Euro-denominated Fund intends to raise a total of US$1,189 billion (€1 billion) from a combination of financial and industrial investors. It will make largely minority co-investments into greenfield projects with key industrial players.
The Fund has already received combined commitments intentions of US$218,7 million (€260 million) from Plug Power, Chart Industries Inc and Baker Hughes.
In addition, Francisco Fernandez, founder and former CEO of Avaloq and a shareholder and member of the Board of Directors of FiveT Capital, is committing US$35,66 million (€30 million). This commitment is part of a global FiveT Capital contribution to the Fund expected to reach up to 5% of the final Fund size.
The Fund’s first closing is expected in the fourth quarter of 2021, with first cash contributed by investors by early 2022 and drawn as required for investment over several years.
This Fund is the first stage of FiveT Hydrogen’s broader ambition to establish an investment platform focused on accelerating the hydrogen economy. The Fund expects to act as a catalyst to scale the H2 market by investing in upstream and downstream opportunities across the value chain.
“The Fund will serve as a catalyst for both the financing and building of global hydrogen infrastructure projects.”
Pierre-Etienne Franc – Co-founder and CEO, FiveT Hydrogen
This includes green hydrogen production and use and downstream distribution assets to the transport segment and associated fleet development schemes. It will finance large projects in the production, storage and distribution of clean H2 primarily in OECD countries. The Fund will support projects in countries with supportive policies, regulations and financial schemes in place which will enable projects to be scaled profitably.
“We firmly believe that clean hydrogen, an energy carrier created from low-carbon sources, will help transform and decarbonise the world’s economy, addressing the global climate emergency and making a positive change to our planet for future generations,” Pierre-Etienne Franc, Co-founder and CEO of FiveT Hydrogen, commented.
“The Fund will serve as a catalyst for both the financing and building of global hydrogen infrastructure projects.”
The establishment of the FiveT Hydrogen Fund reflects the growing focus from global policy makers on the need to urgently decarbonise the creation of infrastructure.
More than 30 governments around the world have already adopted national H2 strategies as part of their climate, creating a huge opportunity.
US$70 billion (€58,86 billion) of public funding has been pledged to accelerate hydrogen at scale-up according to global initiative Hydrogen Council in a report coauthored with consultancy McKinsey.
“The value-creation opportunity is huge. We want to deliver hydrogen energy infrastructure at scale and at pace. We will partner with the primary financial and strategic hydrogen players to do that,” Franc said.
“Being a first mover in the market means that our fund will have the agility and flexibility to identify the right projects and invest in the most compelling infrastructure assets of the future. This is expected to unlock superior, risk-adjusted returns for our investors.”
Accelerating the build-out of hydrogen infrastructure will improve national and corporate abilities to meet net zero and decarbonisation targets.
These ambitions are also driving demand from institutional investors for exposure to cleaner energy sources in line with the Paris Agreement. This could have a lasting impact on environment, society and businesses, contributing to the ESG imperatives of their respective investment portfolios.
