Mark Bouris joins hydrogen play United H2 as it prepares to float

United H2 Limited, which develops and commercialises hydrogen-related companies, has lured Mark Bouris to its board as it targets an ASX listing.

United H2 chief executive Will Davidson and the company’s latest board member, Mark Bouris.

United H2 Limited, which develops and commercialises hydrogen-­related companies, has lured well-known businessman Mark Bouris to its board as it targets an ASX listing.

The holding company, which is essentially a hydrogen venture builder, is developing 14 businesses in the hydrogen sector from production through to end-use.

United H2’s stable of investments includes companies that among them have developed a hydrogen-powered pick-up truck and separately a hydrogen injection system that lowers the emissions of diesel engines. It also holds a stake in a company that developed a liquid ammonia-based jet engine that is being tested for the purpose of retrofitting into corporate jets. Another investment centres on a waste-to-hydrogen production plant that draws on contaminated plastic.

Former Reserve Bank stalwart and Deutsche Bank investment strategy director Don Stammer is among the sophisticated investors that have invested in United H2, in part in his case to assist his granddaughter in finding investments in companies that are decarbonising energy production.

United H2 chief executive Will Davidson said the company had bolstered its board ahead of targeting an initial public offering as early as November, but more likely in March next year.

“We don’t think the small cap market will reopen [to IPOs] until there is visibility on interest rates coming down,” Mr Davidson said, adding that United H2’s model was different to traditional venture capital as it was often building a company from scratch or around an idea or technology.

“We’ll find the technology, we’ll patent the technology, we’ll build everything around the scientist (or founder) and then for example if we add the CEO we’ll give them real equity,” Mr Davidson added.

Mark Bouris has joined the board.

Don Stammer has invested in H2.

United H2 has ownership stakes in its stable of companies ranging from about 3 per cent to 62 per cent, but the average holding is about 50 per cent and may reduce over time.

Mr Davidson said there was scope for the portfolio to “cross pollinate” given they all drew on hydrogen.

Part of the rationale for an ASX listing is to facilitate access to more capital and liquidity, ­allowing United H2 to hold investments for longer.

United H2’s bigger push into businesses seeking to capitalise on hydrogen’s role in the decarbonisation of markets around the world comes as some larger players retreat from the sector.

Billionaire Andrew Forrest in July abandoned his ambitious green ­hydrogen targets in a backdown that accompanied a sweeping restructure at For­tescue.

That came despite the federal government providing about $8bn in investment and support for hydrogen production, as Australia seeks to become a player in global ­efforts to achieve net zero emissions by 2050.

Mr Davidson said he believed part of the issue domestically was that Australia was trying to launch its hydrogen industry as 100 per cent green, which was “a very difficult proposition” given the higher costs involved.

“All of the regions in the world have got together and said this (hydrogen) will be the fuel of the future,” he said. “We believe batteries will solve (for) households and batteries will solve passenger cars, but all the heavy industrial and commercial (equipment) will be on hydrogen. Cars … you can take them home – but heavy industrial equipment will never run on a big battery.”

United H2 was developed out of Liberty Energy Capital, which was established about five years ago. The holding entity has a further 10 or 11 companies in its pipeline, and another batch of projects it is working on.

The latest United H2 accounts lodged with the corporate regulator show it was loss-making in the 2023 calendar year. However, the accounts noted that early this year waste-to-hydrogen company National Hydrogen agreed to sell a stake in the business that valued it at almost $40m. Due to selling into that transaction, United H2 expected to receive $2m.

Mr Davidson said four exits or selldowns in the past three years had resulted in the company securing $24m in cash returns, or 12 times the initial investment.

Hydrogen-powered vehicles release water vapour as exhaust.

Asked about companies that had failed under the venture builder structure, Mr Davidson said the parent entity had a couple that didn’t work out and were shut down. United H2 had lost about $100,000 on each.

“We are mitigating that downside risk,” he said. United H2’s stakes in its stable of companies give it a valuation of about $77m.

However, the market for IPOs has proved highly challenging in recent years.

The ASX is again experiencing a dearth of new listings this year, despite Mexican food chain Guzman y Gomez’s strong start to life on the bourse.

United H2’s board is chaired by Kathryn Giudes, a former Microsoft senior director and managing director of macro­DATA Digital Solutions, while Mr Bouris is the founder of Wizard Home Loans and Yellow Brick Road’s executive chairman.

Asked about Mr Bouris not having energy markets experience, Mr Davidson said: “The big service that we’re providing to all these companies is commercialisation and how to build your company. That’s his skill.”

Mr Bouris said hydrogen had the potential “to revolutionise” the energy landscape.

“United H2 are leading the next wave of great Australian business success stories and I have always been passionate about helping Australian companies,” he said.

Mr Stammer said he believed hydrogen was the solution to lowering emissions in the “hard-to-abate” part of the market.

United H2’s “businesses all result in the elimination of diesel from the energy mix but most importantly they can add capacity that is not reliant on the already under pressure electricity grid,” he said.

Broking house Canaccord Genuity is undertaking research and diligence on United H2 ahead of a potential IPO.United H2 also has law firm Hall & Wilcox on deck to assist, alongside accounting firms HLB Mann Judd and RSM.