Thyssenkrupp considers IPO or SPAC for hydrogen business

Thyssenkrupp is considering an initial public offering (IPO) or a deal with a special purpose acquisition company for its hydrogen business, Chief Executive Martina Merz said on Tuesday.

A 66-34 joint venture of Thyssenkrupp and Italy’s De Nora, Thyssenkrupp Uhde Chlorine Engineers is the world’s largest supplier of chlor-alkali membrane technologies used to produce hydrogen.

In a call with analysts, Merz said Thyssenkrupp has hired an investment bank to explore strategic options for the business and to come up with proposals by the summer.

Two people familiar with the matter said the bank was Citi. Citi declined to comment.

“The main objective behind it is to fund further growth in this business. So we would want to dedicate the potential funds into growth. And that can, of course, mean also to find partners in order to grow,” Merz said.

TKUCE, rivals of which include Norway’s Nel ASA (NEL.OL), Britain’s ITM Power (ITM.L) and France’s McPhy Energy SAS (MCPHY.PA), has a fair value of 2.8 billion euros ($3.4 billion), Credit Suisse wrote in a note last month.

TKUCE, which sources say has annual sales in the double-digit million euro range, was carved out of Thyssenkrupp’s Plant Technology division due to its growth prospects.

Thyssenkrupp declined to comment on the name of the investment bank it had hired or the estimated sales figure.

It referred to TKUCE’s most recent orders, which includes a deal to deliver a 20 megawatt hydrogen production unit to U.S.-based CF Industries (CF.N).