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How a subsidiary of Thyssenkrupp can change the fortunes of the ailing German steel major

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Uhde Chlorine Engineers, rebranded Thyssenkrupp Nucera, makes chlorine electrolysers that can produce hydrogen using renewable energy. Investors have taken to the company’s hydrogen plan, which is expected to break even by September 2024 and generate revenues of €600-700 million in 2025.

How a subsidiary of Thyssenkrupp can change the fortunes of the ailing German steel major
A subsidiary of steel producer Thyssenkrupp could change the fortunes of the ailing German company as it has the potential to witness a tenfold increase in orders for green hydrogen technology.
Uhde Chlorine Engineers, which has been rebranded Thyssenkrupp Nucera, makes chlorine electrolysers, which can produce hydrogen using renewable energy. Nucera splits water into oxygen and hydrogen using electrolysis technology. Companies with heavy carbon emissions, including steelmaking firms, fertiliser companies and the refining industry, can use this green hydrogen to decarbonise.
As Thyssenkrupp faced heavy losses earlier, Nucera was set aside for sale initially, Financial Times reported. The company, which specialised in caustic soda and chlorine gas production, generated €319 million in revenue and €30 million in earnings last year. However, investors have taken to the company’s hydrogen plan, which is expected to break even by September 2024 and generate revenues of €600 million to €700 million in the following financial year, Wall Street Journal reported. By redesigning the product, Nucera can use its existing facilities to produce one gigawatt annually of green-hydrogen electrolysers at competitive costs, the report said.
“Two or three years ago, nobody was investing into green hydrogen — only in renewable energy,” Financial Times quoted Denis Krude, CEO of Nucera, as saying. While hydrogen can be transported, renewable energy has “a limited reach,” he said.
There has been a recent rush for green hydrogen across all regions in the world on the back of lower prices for renewable power, he said.
“Nucera is a really unique asset in our portfolio,” Financial Times quoted Volkmar Dinstuhl, in-charge of selling smaller Thyssenkrupp businesses, as saying.
Meanwhile, Thyssenkrupp aims to raise €600 million euros from a share sale in Nucera through an initial public offering this year, Reuters reported.
The company will use the proceeds to expand its capacity fivefold, develop the technology and underwrite big projects, Wall Street Journal said. Compared to other green-hydrogen stocks, Nucera's share sale would be different as investors know that its technology has been proven and it already has the industrial capacity for production.
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