Plug Power Inc. (NASDAQ: PLUG) shares closed over 5% lower in the ordinary session on Monday.
What happened: Shares fell despite an announcement on the day the company partnered Chart Industries, Inc. (NYSE: GTLS) and Baker Hughes (NYSE: BKR) to become “cornerstone investors” in the formation of a “unique” new pure hydrogen-only private infrastructure fund called the FiveT Hydrogen Fund.
The fund will be dedicated to delivering pure hydrogen infrastructure projects on a scale according to a Plug Power statement.
While Plug Power says it intends to commit to 160 million euros ($ 200 million), Chart Industries, a global manufacturer of energy and industrial gas market equipment, and Baker Huges, an energy technology company, will place 50 million euros (respectively) ( $ 60 million).
The fund will “exclusively fund projects”
FiveT, denominated in euros, is offered only to qualified and verified investors and aims to raise 1 billion. EUR ($ 1.18 billion) from both financial and industrial investors according to Plug Power.
The initial investment covers only 26% of the fund’s stated fundraising objectives.
Why it means: Last week, Plug Power’s shares jumped 10.6% higher after the hydrogen solution company announced plans to build a green hydrogen production plant in partnership with Brookfield Renewable Partners LP (NYSE: BEP) and Brookfield Renewable Corporation (NYSE: BEPC).
Price action: Plug Power shares closed 5.16% lower at $ 33.44 on Monday, winning 0.18% in the after-hours session.
Benzinga takes: The fact that FiveT will provide financing to projects or potential customers raises concerns about the demand for pure hydrogen products, and this may be a potential reason for investors to be less than enthusiastic about the announcement.
© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.