TotalEnergies’ Investment in Hyzon Motors

In November 2021, Girish Nadkarni, the head of TotalEnergies’ corporate venture capital arm (TEV) was considering whether, and on what terms, to exit an investment in Hyzon Motors, a start-up supplier of hydrogen-powered trucks. TEV had invested $4 million in Hyzon, which had gone public in July 2021 with a $2.7 billion valuation. Nadkarni was now eager to take TEV’s gains, but recognized the potential harm that selling TEV’s Hyzon shares could cause. Market observers might interpret TEV’s exit not as profit-taking but as an early investor’s lack of confidence in Hyzon’s prospects. Further, TotalEnergies had signed an MOU with Hyzon to bring 80 trucks to Europe—the goal was to demonstrate for its truck fleet customers the viability of hydrogen as a viable replacement fuel for the diesel it already supplied. Selling the Hyzon shares might convey the opposite message.