SK Group to invest $1.5 bn in U.S. Plug Power for hydrogen drive

SK Holdings Co., the holding entity of SK Group, and SK E&S Co., a natural gas subsidiary, announced on Thursday that they will acquire a combined 9.9 percent stake in U.S. fuel cell maker Plug Power Inc., joining South Korea’s drive in hydrogen economy.

SK Holdings and SK E&S will each contribute 800 billion won ($734.6 million) for the 1.6 trillion won acquisition that would make SK names the largest shareholder in the New York-based power company.

Shares of SK Holdings closed 8.42 percent higher at 296,000 won on Thursday.

Plug Power – founded in 1997 – owns multiple core technologies such as those involving vehicle-use polymer electrolyte membrane fuel cell (PEMFC) in hydrogen business value chain; electrolytic cells, a key facility for water electrolysis; liquefied hydrogen plant; and hydrogen charging station construction. The company – with market capitalization of 16 trillion won as of end of last year – kept up annual sales growth of about 50 percent.

[Photo provided by Plug Power Inc.]

Plug Power has capacity for hydrogen-based mobility business such as forklifts and trucks that use hydrogen as energy. It also is exclusive supplier of hydrogen forklifts to global retailers such as Amazon and Walmart, dominating the U.S. hydrogen forklift supply market, SK Group said.

Recently, Plug Power advanced into the mid- to large-size truck market utilizing its hydrogen charging station network established across the U.S. and is diversifying usage of hydrogen fuel cells to include drones and aircrafts. The company is also seeking to expand business to Europe.

In the second half of this year, Plug Power plans to complete construction of world’s largest 1.5 Gigawatt fuel cell production facility in New York State and begin production.

The plant is expected to significantly lower production cost of electrolysis facility and fuel cell and secure cost competitiveness to solidify its global leading position.

SK Group expected to also secure leadership in the Asian hydrogen market based on synergy between the businesses as largest shareholder of Plug Power.

[Photo provided by Plug Power Inc.]

SK Group plans to leverage Plug Power technologies to bring forward the creation of hydrogen ecosystem while in China and Vietnam seek new business development opportunities by utilizing its network.

SK Group and Plug Power will set up a joint venture to advance into Asia’s hydrogen market.

Last year, SK Group established a hydrogen business team consisting of 20 members from various affiliates including SK E&S, SK Engineering & Construction, and SK Innovation. The conglomerate plans to produce 30,000 tons of liquefied hydrogen per year from 2023 and secure 280,000 tons capacity by 2025 to manage an integrated value chain with an aim to nurture hydrogen as next-generation energy source.

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