(Bloomberg) -- Bloom Energy Corp. surged the most in 15 months after after the maker of hydrogen fuel cells agreed to provide $4.5 billion of equipment and services to the South Korean conglomerate SK Group.
Bloom's stock gained 37% in New York trading on Monday to touch $27.68, the most intraday since mid-July 2020. The shares traded at $27.67 as of 12:03 p.m. New York time.
SK's Ecoplant unit will buy at least 500 megawatts of Bloom's systems over three years and plans an equity investment of about $500 million, the San Jose, California-based company said Monday in a statement. SK will also gain a seat on Bloom's board of directors. The deal expands a partnership that dates back three years, with deliveries in the coming three years representing a $4.5 billion revenue commitment. Bloom had $794 million in revenue for 2020.
Companies and governments around the globe are seeking to boost the use of hydrogen as a replacement for fossil fuels in in power plants, vehicles and elsewhere. While most hydrogen is produced from natural gas, it can also be generated from water through electrolysis powered by renewable energy. When burned, it produces no greenhouse gases. It can also generate carbon-free electricity when fed through a fuel cell.
SK in January invested $1.6 billion into one of Bloom's competitors, Plug Power Inc., and earlier this month announced a joint venture with Plug to sell electrolyzers, hydrogen fueling stations and fuel cells throughout Asia.
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