Fusion Fuel Issues Damages Claim Against Hydrogenial S.A. for Failure to Fund $33.5 Million Subscription Agreement; Announces Insolvency of Portuguese Subsidiary

Rhea-AI Summary

Fusion Fuel Green has issued a damages claim against Hydrogenial S.A. for failing to fund a $33.5 million Subscription Agreement signed on August 28, 2024. The agreement involved Hydrogenial purchasing 43,790,850 Class A shares and warrants for 13,137,254 additional shares. Despite meeting all closing conditions for the September 30, 2024 deadline and receiving a revised closing date of October 25, 2024, Hydrogenial has not provided the promised funds. As a direct result, Fusion Fuel Portugal S.A., the company's Portuguese subsidiary responsible for technology sales and project development, has filed for insolvency. The company is now exploring strategic alternatives to preserve shareholder value.

Positive

• Company is actively exploring strategic alternatives including potential synergistic transactions

Negative

• Failed to secure $33.5 million in committed funding from Hydrogenial
• Portuguese subsidiary Fusion Fuel Portugal S.A. filed for insolvency
• Loss of main operational subsidiary handling technology sales and project development
• Legal proceedings may result in additional costs and uncertainties

Insights

Legal & Financial Analyst

The failure of Hydrogenial to fulfill its $33.5 million subscription agreement represents a severe blow to Fusion Fuel's operations, leading to the insolvency of its critical Portuguese subsidiary. This development is particularly concerning as the Portuguese unit was responsible for core technology sales and project development activities.

The legal claim for damages, while warranted, faces uncertain prospects and timing for resolution. The company's immediate pursuit of strategic alternatives, including potential transactions, signals severe liquidity constraints. The situation raises significant going concern issues, especially given the relatively small market cap of approximately $10.3 million.

This event chain severely impacts Fusion Fuel's operational capacity and market position in the hydrogen sector. Investors should note that the company's ability to continue operations in its current form is now questionable, with potential significant dilution or restructuring likely necessary for survival.

DUBLIN, Nov. 14, 2024 (GLOBE NEWSWIRE) -- Fusion Fuel Green Plc (“Fusion Fuel” or the “Company”) announced today that it has issued a damages claim against Hydrogenial S.A. (“Hydrogenial” or the “Investor”) and its principal, Mr. Norbert Bindner, following their failure to fund the $33.5 million Subscription Agreement disclosed in the Company’s Form 6-K on September 11, 2024. Under the terms of this agreement, entered into in good faith by the Company on August 28, 2024, the Investor committed to purchase an aggregate of 43,790,850 Class A ordinary shares (the "Class A Shares"), along with warrants to acquire an additional 13,137,254 Class A Shares, for a total purchase price of $33,500,000.

Pursuant to Section 3 of the Subscription Agreement, the closing was to take place on September 30, 2024, with full payment due at or before the time of the closing. Despite all conditions to closing being met, as confirmed in discussions with Hydrogenial representatives, the Investor failed to fund in a timely fashion. The Company promptly informed Hydrogenial of its breach and requested immediate resolution, and Hydrogenial subsequently provided the Company with a revised closing date of October 25, 2024; however, to date, the Company has yet to receive proceeds from the investment. This continued delay has led Fusion Fuel to pursue legal recourse.

As a direct consequence of the funding delay, Fusion Fuel has filed for insolvency for its Portuguese subsidiary, Fusion Fuel Portugal S.A., out of which the most significant portion of the Company’s technology sales and project development activities had been conducted. On the advice of insolvency counsel, the Company has submitted a claim in Portugal for damages incurred due to Hydrogenial’s breach. The Company notes that the Investor’s obligation under the Subscription Agreement remains in effect notwithstanding the filing of the claim and the insolvency of its Portuguese subsidiary.

In response to these events, Fusion Fuel is actively exploring strategic alternatives to preserve shareholder value, including a potential transaction that management believes could complement the Company’s hydrogen business and yield significant synergies. The Company expects to provide further updates in short order.

About Fusion Fuel Green plc

Fusion Fuel is an emerging leader in the green hydrogen sector committed to accelerating the energy transition by developing disruptive, clean hydrogen solutions. Fusion Fuel’s patented miniaturized Proton Exchange Membrane (PEM) electrolyzer – the HEVO – and building-block approach to green hydrogen production unlock unprecedented modularity, flexibility, and reliability in the design and deployment of small-to-midscale green hydrogen solutions. Its business lines include selling its electrolyzer systems, developing and selling turnkey hydrogen plants, and providing end-to-end project engineering and advisory services. Learn more about Fusion Fuel by visiting our website at https://www.fusion-fuel.eu and following us on LinkedIn.

Forward-Looking Statements

This press release includes “forward-looking statements.” Forward-looking statements may be identified by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target”, “may”, “intend”, “predict”, “should”, “would”, “predict”, “potential”, “seem”, “future”, “outlook” or other similar expressions (or negative versions of such words or expressions) that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the Company’s control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Fusion Fuel has based these forward-looking statements largely on its current expectations, including but not limited the ability of the investment reported on to be consummated as anticipated. Such forward-looking statements are subject to risks and uncertainties (including those set forth in Fusion Fuel’s Annual Report on Form 20-F for the year ended December 31, 2023, filed with the Securities and Exchange Commission) which could cause actual results to differ from the forward-looking statements.

Investor Relations Contact

ir@fusion-fuel.eu 

FAQ

Why did Fusion Fuel (HTOO) file a damages claim against Hydrogenial S.A.?

Fusion Fuel filed a damages claim because Hydrogenial failed to fund a $33.5 million Subscription Agreement that was due to close on September 30, 2024, and subsequently missed a revised closing date of October 25, 2024.

What happened to Fusion Fuel's (HTOO) Portuguese subsidiary in November 2024?

Fusion Fuel Portugal S.A., the company's Portuguese subsidiary responsible for technology sales and project development, filed for insolvency due to the failure to receive the committed $33.5 million funding from Hydrogenial.

What was the value of the Subscription Agreement between Fusion Fuel (HTOO) and Hydrogenial?

The Subscription Agreement was valued at $33.5 million for 43,790,850 Class A shares and warrants to acquire an additional 13,137,254 Class A shares.