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Atome Energy Plc makes premium-priced London debut

Atome Energy PLC (AIM:ATOM) made a premium debut as the green energy spin-out began trading on the London Stock Exchange.

The share rose to a high of 87.5p in Thursday morning’s deals.

The company, an innovator in the sustainable energy arena, has been split out of oil and gas group, President Energy following a £9mln fundraise at 80p per share.

It is now the first and currently only company solely focusing on being a producer of green hydrogen and ammonia listed on the London Stock Exchange, and, the company has been given the LSE’s ‘Green Economy Mark’.

“Today marks an important milestone for both ATOME and the London market’s place in the transition to a green economy,” said chief executive Oliver Mussat.

“We are proud of the award of London Stock Exchange’s Green Economy Mark.

“This prestigious classification represents our commitment as a company to meaningfully mitigate the impacts of climate change and is a clear message to our investors and other stakeholders of the commitment of ATOME in supporting the transition to net zero.”

ATOME’s plan is to produce, market and distribute green hydrogen and ammonia, areas that are expected to emerge as a rapidly growing market.

An exciting hydrogen energy future

Hydrogen is widely considered within the ESG clean energy sector as a key part of the matrix of renewable power sources, necessary to meet net-zero carbon emissions targets by 2050.

ATOME Energy has two operating subsidiaries: ATOME Paraguay based in Paraguay, and Green Fuel based in Iceland.

Both subsidiaries have commenced operational planning, sourcing and negotiations with green electricity suppliers, equipment providers and offtake partners

Mussat added: “With the funding secured, ATOME is in a position to rapidly progress its projects in Iceland and Paraguay towards Final Investment Decision (or FID) in both countries.

“The projects both plan to deliver green energy using mature technology and low-cost baseload power which is available on-tap in both locations.

“Our projects have government support and accessible markets which need green hydrogen and ammonia to reach their net zero targets, and ATOME is positioned to capitalise on this.

“We have an exciting road ahead as nations implement decarbonisation strategies with green hydrogen and ammonia at their heart. We look forward to updating shareholders on ATOME’s progress during 2022 with increasing newsflow as we move towards FID.”

A unique opportunity, says SP Angel

The newly listed company is described by stockbroker SP Angel as a unique opportunity to access a low-risk renewables play.

“ATOME provides investors with potential access to upstream green hydrogen and ammonia production, managed by experienced and well-connected leadership teams in two stable democratic countries, Paraguay and Iceland. Both countries are ideally suited to the production of green hydrogen with a continuous supply of green electricity, potential internal offtake demand, available export markets, favourable fiscal conditions and an educated and available workforce with benign labour condition,” analyst Sam Wahab said in a note.

“In our view, the ATOME investment case offers investors a compelling entry point into an exponentially growing market, with first mover advantage in two strategically important geographies with regards to the monetisation of green hydrogen and ammonia.

“Post admission, the next key valuation catalyst will be to achieve FID across its portfolio.

“At which point, ATOME will have access to a plethora of corporate and or debt/infrastructure opportunities to develop its position in both Iceland and Paraguay to generate transformational medium-term returns.”

SP Angel highlighted that the global market for hydrogen is growing, currently estimated at around 70mln tonnes per year and should reach 111mln tonnes by 2025 – whereas International Energy Agency (IEA) estimates see the markets expanding to some 530mln tonnes per year by 2050.

President Energy spin-out

Earlier in December, President Energy confirmed its shareholders – except those in excluded territories – will receive a stake in the Atome Energy company as it floats in London before the end of December.

Qualifying shareholders received 1 Atome share for every 169 President shares they held.

Shares that would be due to shareholders in the United States, Australia, Canada, Japan, South Africa and New Zealand were assigned to Atome’s broker, which “will facilitate an orderly distribution of the shares into the markets and any net proceeds will be remitted to the relevant shareholders”, President said on December 24.

Along with President Energy shareholders and placing shareholders, ATOME is also backed by a strong strategic and institutional base which includes international commodity trader and logistics firm Trafigura.

Read More: Atome Energy Plc makes premium-priced London debut

2021-12-30 07:44:00

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