ITM Power, which produces hydrogen for use in vehicles, has announced a plans to raise £25 million in a new share offering to existing shareholders and a further £4.4 million through an open offer.

The placing is being conducted by Investec Bank. The proceeds will provide working capital to support the delivery of the contract backlog and opportunity pipeline, to move to new larger facilities to increase annual production capacity, to strengthen the company’s balance sheet, and to move toward achieving positive cash flow and profitability within the medium term.

Chief executive Graham Cooley said:
“We are delighted to disclose our c.£180 million opportunity pipeline of highly qualified tenders, which sits behind our growing backlog of contracted orders. … The £25 million placing and up to c.£4.4 million open offer considerably strengthens our balance sheet and should provide enhanced confidence to our customers on ITM Power’s ability to deliver future orders at increased scale. It should also enable us to unlock further efficiencies in our supply chain. We look forward to updating the market as opportunities are converted from pipeline to contracted sales, as we near our target of positive cashflow generation.”

As at 19 September 2017, ITM Power said it had c.£20 million of projects under contract and a further c.£16.7 million in the later stages of negotiation. In addition, the Group has an opportunity pipeline of c.£180 million of commercial sales, which consists of over 50 separate projects across all three of the Group’s end markets.

The company also wants to install an enlarged grid connection of up to 5MW, so it can test larger scale electrolysers.