Corporate venture capital vehicle, Conduit Ventures has been set up by Shell Hydrogen, Mitsubishi Corporation and Johnson Matthey as Europe’s first fund focusing on the high growth area of fuel cells and related hydrogen technologies. Conduit will make investments in companies with established fuel cell and hydrogen technologies, which are seeking further capital for commercial sales and development.
The London-based fund will target global investments with a particular focus on Europe and North America. External investors will also be invited to join the fund, which has a target of $100 million.
The fund is being managed by two former Schroder Salomon Smith Barney veterans with experience in the energy and fuel cell industries. John Butt was formerly a director of European M&A and John Knight was managing director and head of European Oil and Gas.
“We believe that fuel cells and related hydrogen technologies have enormous potential to become the fuel technologies of the future,” said Don Huberts, chief executive of Shell Hydrogen. The current market for fuel cells is around $218 million and is estimated to rise to $2.4 billion by 2004 and $7 billion by 2009.
Conduit will take stakes in companies of between 10 per cent and 40 per cent and will concentrate on investments that are at a post-seed/pre-IPO stage with technology that is close to commercialisation, says Huberts.
Johnson Matthey is a specialty chemicals company focused on precious metals, catalysts and other fine chemicals. Mitsubishi Corporation has interests in all areas of the emerging hydrogen economy and also has its own business development plans in fuel cell related industries. Fuel cell technologies are already being used for stationary power, residential power and portable power with future applications in bus and car engines. Orders for larger fuel cells to produce electricity in competition with existing power stations and grid electricity are starting to emerge in the US and Europe.