The heir to the JCB excavators empire, Wright Bus chairman Jo Bamford, confirmed to City A.M. this morning that he has joined forces with multi-family office Vedra Partners to launch HyCap, a new hydrogen investment fund which has set its sights on raising £1bn.
The capital, which currently stands at just over £200m after the first round of investment, will be injected largely into UK businesses, with the focus on speeding-up green hydrogen production and supply, creating jobs and contributing to the government’s Net Zero targets.
Bamford said he and his team had so far identified more than 40 firms in the hydrogen space which will be evaluated for investment.
Co-partner in the investment vehicle is Vedra Partners’ founder and City insider Max Gottschalk, who is also is a founding partner of Ocean 14 Capital, a private equity fund dedicated to protecting oceans.
In the City, Gottschalk is mostly known as the fund manager who took the Gottex managed funds from $3m of seed capital in 1999 to a $16bn success story eight years later.
“This new fund will be investing across the entire value chain, focusing on production, manufacture and supply, in order to put the UK firmly on the map when it comes to hydrogen,” Gottschalk explained to City A.M. this morning.
“By striking partnerships and developing go-to-market strategies HyCap’s maiden fund can add strategic, operational and financial value to the ecosystem while creating entrepreneurial growth businesses,” he added.
When fully deployed, the fund will unlock large-scale long-term job creation and aim to save up to 25 per cent of cities’ transport budget, Gottschalk said.
Appetite for sustainable investments
With the UK hosting COP26 in Glasgow later this year, Bamford said there was “no time to wait” in order to harness the appetite of sustainably focused investors.
He stressed the UK hydrogen sector would need a £1bn injection to help it compete with other territories.
“With the Government’s relentless pursuit of Net Zero targets and the publication of the damning IPCC report, it is our belief that hydrogen holds the key to reducing emissions – and there is a growing sense of urgency to act now,” Bamford explained.
“The UK has missed the boat on batteries, a sector dominated by China and the Far East, but we can be global leaders in the production and supply of hydrogen – an economy said to be worth $2.5 trillion in revenues by 2050.” – Jo Bamford
“We have also discovered that investors around the world match the ambitions of global governments in wanting green-focused funds which have a positive impact on climate change,” he added.
Bamford said there were a number of key drivers for the renewed interest in hydrogen: 70 per cent of global GDP is linked to hydrogen country roadmaps; membership of the Hydrogen Council has increased almost five-fold since 2017, and the UK Government has pledged to have 5GW of low-carbon hydrogen production by 2030.