Launch of an anticipated 150 million euros Capital Increase by way of an Accelerated Bookbuild comprising:
- Strategic Cornerstone investment from Chart Industries of € 30m
- Strategic Cornerstone investment from Technip Energies of € 15m
- Existing Shareholders Cornerstone investments totaling € 14m from EDF Pulse Croissance Holding and the Ecotechnologies Fund managed by Bpifrance Investissement
La Motte-Fanjas – McPhy (Euronext Paris : MCPHY – ISIN : FR0011742329), (the “Company”), specialized in zero-carbon hydrogen production and distribution equipment, announces today the launch of a capital increase without shareholders’ preferential subscription rights, by means of an Accelerated Bookbuild to the benefit of certain categories of beneficiaries, in accordance with Article L. 225- 138 of the French Commercial Code for an anticipated aggregate amount of € 150m (the “Offering “).
The Offering comprises Cornerstone subscription commitments from Chart International Holdings, Inc., part of Chart Industries, Inc. (NASDAQ: GTLS) (“Chart Industries”) and Technip Energies B.V. (“Technip Energies” a segment of TechnipFMC plc) (the “Strategic Investors”) and from historical strategic shareholders EDF Pulse Croissance Holding and the Ecotechnologies Fund, managed by Bpifrance Investissement as part of the Programme d’Investissements d’Avenir.
The funds raised under the Offering will be used primarily to finance the acceleration of the change of scale of McPhy manufacturing capacities, to fund continued research and innovation with an emphasis on large- capacity stacks and large-capacity hydrogen refueling stations, as well as for working capital and operating expenses of the Company.
McPhy is also pleased to announce the concomitant signing of Memorandum of Understandings (“MoU”) with each of the two Strategic Investors.
Laurent Carme, Chief Executive Officer of McPhy, comments: “We are thrilled to welcome Chart Industries and Technip Energies as Strategic Investors in McPhy. In addition to a significant capital injection, these new strategic partners bring deep expertise in their respective domains, and we anticipate new commercial opportunities in hydrogen across Europe and globally
Moreover, the complementarity of their activities with our own will put McPhy in an optimal position to work on large projects in Industry, Mobility and Energy and to scale-up our industrial capabilities. We look forward to strengthening the Board of Directors with the presence of Jillian Evanko from Chart Industries and a representative of Technip Energies and to see our respective teams collaborating on a number of already identified projects.
I would like to thank EDF Pulse Croissance Holding and Ecotechnologies Fund for their continuous support to McPhy, both from an operational and financial perspective. We are also excited to welcome participation from existing investors and new institutions into the share capital of McPhy in conjunction with the announced capital raise.
More than six years after our IPO on Euronext in 2014, zero-carbon Hydrogen is now at major inflection point. With this fundraising, new Strategic Investors, the continued support of EDF Pulse Croissance and the Ecotechnologies Fund, as well as all our shareholders, McPhy is well positioned to play a leadership role in the global build-out of competitive zero-carbon hydrogen and on the decarbonization of industrial processes, of mobility sector, and in the energy storage.”
Highlights of the Transaction:
McPhy intends to raise € 150m under the Offering, representing a dilution of c. approximatively 27.30% based on the number of shares outstanding prior to the Offering1.
- Strategic Cornerstone Investment of € 30m from Chart Industries, a leading independent global manufacturer of liquefaction and cryogenic equipment servicing multiple applications in the energy and industrial gas markets, including hydrogen; which will hold 4.3% of the capital of McPhy post-Offering1.
- Strategic Cornerstone Investment of € 15m from Technip Energies, a segment of TechnipFMC and a leading international contractor in engineering, procurement, construction and installation for the global energy industry, with proprietary hydrogen technology installed in 270 hydrogen production plants worldwide; which will hold c. 2.1% of the capital of McPhy post-Offering1.
- Strategic Cornerstone Investments will all be made at the same price as that of institutional investors achieved in the Accelerated
- Cornerstone Investment of € 6m from EDF Pulse Croissance
- Cornerstone Investment € 8m from the Ecotechnologies Fund, managed by Bpifrance Investissement as part of the Programme d’Investissements d’Avenir.
- Intended incremental institutional placing of c. approximatively € 90m by means of an Accelerated Bookbuilding.
- Net proceeds from the Offering will be used primarily to finance over the next 48 months:
- Acceleration of the change of scale of McPhy manufacturing capacities;
- Research & Innovation expenses, with a focus on the development of large capacity stacks to target large-scale projects (>100MW) and large-capacity hydrogen refueling stations (>2 tons per day);
- Sales and Marketing expenses, to accelerate the international commercial ramp-up;
- Acceleration of the recruitment policy;
- Working Capital
- Appointment of Jillian Evanko as McPhy Board representative of Chart Industries and a representative of Technip Energies at the Board of Directors of McPhy to be proposed at the next shareholders’ general meeting to be held on or before January 31,
- Signing of a MoU with each Strategic Investor focusing on unlocking commercial opportunities across the Hydrogen value-chain globally, for a renewable period of five
Advisors to the Company:
Bryan, Garnier & Co Limited is acting as Sole Global Coordinator and Sole Bookrunner in connection with the Offering, as well as Sole Advisor in connection with the Cornerstone Investments from the Strategic Investors as well as EDF Pulse Croissance Holding and Ecotechnologies Fund (the “Sole Global Coordinator“). King & Spalding is acting as Legal Advisor to the Company and to Bryan, Garnier & Co Limited as Transaction Counsel.
Summary of the Offering:
The Offering comprises the Cornerstone Investment commitments and the Accelerated Bookbuild directed at institutional investors. Cornerstone commitments from Strategic Investors Chart Industries and Technip Energies and existing long-term shareholders EDF Pulse Croissance Holding and the Ecotechnologies Fund amount to € 59m. Via the Accelerated Bookbuild, McPhy intends to raise an estimated additional approximatively € 90m for the Company from French and international institutional investors. In total, McPhy anticipates raising approximately € 150m of gross proceeds from the Offering, which will in any case be limited to a maximum number of 11,000,000 shares, in accordance with the terms of the 19th resolution of the Company’s general meeting held on May 20, 2020.
The offering price per McPhy ordinary share for the Offering will be determined by the Board of Directors following the Accelerated Bookbuilding process commencing immediately and expected to end before markets open on the market of Euronext Paris (“Euronext“) on October 14, 2020. The offering price will not be less than 80% of the volume weighted average price of the share over the three preceding trading days (i.e. October 9 to October 13). All investors, including the Strategic Investors, EDF Pulse Croissance Holding and the Ecotechnologies Fund, and institutional investors will subscribe at the price determined in the Accelerated Bookbuild.
The Company will announce the results of the Offering and the final number of ordinary shares sold in the Offering as soon as feasible thereafter in a subsequent press release.
The Offering is made as part of a share capital increase without shareholders’ preferential subscription rights pursuant to Article L. 225-138 of the French Commercial Code, reserved to categories of beneficiaries satisfying determined characteristics under the 19th resolution of the Company shareholders’ general meeting held on May 20, 2020 following (i) in the EEA a book building process to qualified investors in accordance with Regulation (EU) 2017/1129 of the European Parliament and of the Council of June 14, 2017 and belonging to the categories of persons satisfying determined characteristics and (ii) a private placement to investors belonging to the categories of persons satisfying determined characteristics outside the EEA in accordance with the rules specific to each country concerned, in particular outside the United States in reliance on Regulation S under the U.S. Securities Act of 1933, as amended (the “Securities Act”) and in the United States pursuant to an exemption from registration under the Securities Act.
The new shares will carry current dividend rights, will give right, from their issuance, to all distributions decided by the Company as of that date and will be admitted to trading on Euronext under the same ISIN code FR0011742329 – MCPHY on October 16, 2020.
Application will be made to list the new shares to be issued pursuant to the Offering on Euronext pursuant to a listing prospectus subject to a visa application with the French Autorité des marchés financiers (“AMF“) and comprising the 2019 Universal Registration Document (Document d’Enregistrement Universel 2019) registered with the AMF on April 22, 2020 under the number 20-0334, an amendment to the 2019 Universal Registration Document and a Securities Note (Note d’opération), including a summary of the prospectus.
Highlights of the Collaborations between McPhy and the Strategic Investors:
Chart Industries is a leading independent global manufacturer of highly engineered equipment servicing multiple applications in the Energy, Industrial Gas and Clean Energy Transition markets. With a 2019 total revenue of USD 1.3bn Chart’s unique product portfolio is used in every phase of the liquid gas supply chain, from liquefaction and purification to distribution, storage and end-use. Being at the forefront of the clean energy transition, Chart is a leading provider of technology, equipment and services related to liquefied hydrogen, natural gas, biogas and CO2 capture, amongst other applications. Chart is listed on NASDAQ under the symbol GTLS.
The MoU between McPhy and Chart Industries sets the pace of commercial collaboration to stimulate new hydrogen demand for the parties’ respective equipment and solutions globally, by identifying new customers and projects. Chart and McPhy will also work on studying options to scale up projects for production, storage, transport and fueling in all addressable markets. Chart Industries also intends to financially support the joint collaboration and partnership beyond the strategic investment contemplated today.
TechnipFMC is a global leader in the energy industry; delivering projects, products, technologies and services. With its proprietary technologies and production systems, integrated expertise, and comprehensive solutions, it is transforming its customers’ project economics. TechnipFMC is organized in three business segments — Subsea, Surface Technologies and Technip Energies. TechnipFMC is listed on NYSE and Euronext Paris under the symbol FTI.
Technip Energies offers extensive experience, technologies, know-how and unique project management capabilities for the global energy industry. Its expertise includes a full range of design and project development services, from feasibility studies to project delivery. With 60 years history executing some of the world’s largest and most complex projects, Technip Energies combines leading engineering and construction management capabilities with technological know-how to develop new solutions that will support the world’s energy transition. Technip Energies’ ambition is to accelerate the journey to a low-carbon society with a focus on core pillars of liquefied natural gas, sustainable chemistry, decarbonization and carbon-free energy solutions.
Technip Energies is already a market leader in hydrogen having provided proprietary technology for more than 270 hydrogen production plants worldwide.
The MoU between McPhy and Technip Energies establishes a collaboration framework for the manufacturing and commercialization of (i) hydrogen electrolysis production systems for heavy industry, renewable energy storage and large mobility projects and (ii) hydrogen distribution systems for large mobility projects. Through the MoU, McPhy and Technip Energies will to jointly address commercial opportunities, work on integrating their respective offerings and work jointly on research and development for hydrogen technology.
In connection with the Offering, the Company has entered into a lock-up agreement restricting the issuance of additional ordinary shares for a period ending 180 days after the execution of the placement agreement to be entered into between the Company and the Sole Global Coordinator on October 14, 2020 (the “Placement Agreement”).
The Strategic Investors, historical shareholders EDF Pulse Croissance Holding and Bpifrance Investissement’s Ecotechnologies Fund will each be subject to a lock-up on the new shares subscribed under the Offering for a period of 180 days from the settlement date of the new shares, subject to customary exceptions.
Underwriting of the Offering:
The Offering is not underwritten. The Offering is subject to the Placement Agreement, in accordance to which the Sole Global Coordinator undertook, with respect to the Company and in connection with the new shares, to use its best efforts for the new shares to be subscribed at the issue price on the settlement date of the Offering. The Placement Agreement does not constitute a firm undertaking (garantie de bonne fin) within the meaning of article L. 225-145 of the French Commercial Code.
The Placement Agreement may be terminated by the Sole Global Coordinator at any time up to (and including) the settlement date expected on October 16, 2020 under certain conditions. In the event that the Placement Agreement is terminated in accordance with its terms, all the orders of investors and the subscription agreements entered into under the Offering will be null and void.