Fuel-cell truck startup Hyzon's SPAC merger includes US$400m investment

[SAN FRANCISCO] Fuel-cell truck startup Hyzon Motors' deal to go public through blank-cheque company Decarbonization Plus Acquisition Corp will include a US$400 million investment, according to people familiar with the matter.

Participants in the private investment in public equity, or Pipe, include BlackRock, Fidelity Management & Research Co and Wellington Management, among others, said the people, who asked not to be identified because the information was private.

The Pipe, which was oversubscribed, is part of Hyzon's agreement with Decarbonization Plus, which is backed by private equity firm Riverstone Holdings, the people said. Bloomberg News previously reported that Hyzon was in talks to merge with Decarbonization Plus, a special purpose acquisition company, or SPAC, that raised about US$226 million in an initial public offering in October.

Representatives for Hyzon and Decarbonization Plus declined to comment. Spokespeople for Fidelity and Wellington couldn't be reached for comment, while BlackRock didn't have an immediate response.

Hyzon is the latest in a string of clean-energy vehicle startups to consider SPAC mergers. The transaction would generate about US$626 million in gross proceeds for Hyzon, the people said.

Hydrogen and fuel-cell technology in commercial vehicles isn't new. However, investor interest has intensified since US startup Nikola Corp went public in June in a deal with blank-cheque company VectoIQ Acquisition Corp.

Despite having no revenue, Nikola's market value surged as high as US$28.8 billion before sliding back to its current valuation of about US$9 billion. Nikola has promised global fleets of hydrogen fuel-cell semi trucks and other commercial vehicles and plans to begin production in 2023.

Hyzon was spun out of Singapore-based Horizon Fuel Cell Technologies, which has been developing fuel-cell technology for commercial applications for almost 20 years. The startup, whose investors include Total, makes hydrogen-powered big rigs, buses and coaches.

The company is headquartered at a former General Motors facility near Rochester in Honeoye Falls, New York. In July, it announced plans for a plant in the Netherlands as part of a joint venture with Holthausen Clean Technology. It also has unspecified manufacturing activities with an undisclosed partner in Shanghai, and operations elsewhere in Asia and in Australia.

PRODUCTION TARGET

Decarbonization Plus, led by Erik Anderson, said last year it would target a company "whose principal effort is developing and advancing a platform that decarbonises the most carbon-intensive sectors". Hyzon already has more than 400 commercial vehicles on the road using its fuel cell technology, the company has said. It expects to deliver about 5,000 fuel cell-powered trucks and buses by 2023 and is targeting annual capacity of around 40,000 fuel cell-electric vehicles by 2025.

In August, Hyzon reached a deal with Australian mining company Fortescue Metals Group to build a fleet of hydrogen fuel cell buses.

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