Metacon has announced that it has acquired additional shares in Pherousa, a Norwegian technology transfer company within the maritime industry, bringing its total ownership to 35% of the capital. With this increased shareholding, along with an updated exclusive license agreement, we believe that Metacon is gaining a larger stake in an innovative company in an exciting market at a seemingly low cost. However, this news does not directly impact our forecasts or our view on the stock.

Increased involvement to support sustainable shipping innovation

Metacon, through its wholly owned subsidiary Metacon S.A., has held a small ownership stake in Pherousa since around 2020, although the projects have progressed at a slower pace. However, according to Metacon, recent successful developments at Pherousa have led the company to take the next step in supporting its mission to enable sustainable shipping by increasing its shareholding to approximately 35% of the capital.

Additionally, Metacon and Pherousa have signed an updated exclusive license agreement for Metacon's ammonia cracking technology for use aboard vessels. To our understanding, Metacon will act as a technology partner and retain the rights to supply the core reactor (cracking) modules, while Pherousa will have the rights to commercialize, market, and sell the ammonia-to-hydrogen cracker. A prototype of the technology was developed and successfully tested in 2022. If commercialized successfully, the technology could enable the shipping industry to use ammonia as a hydrogen storage medium, providing a CO2-free solution for the decarbonization of deep-sea shipping. In addition, Metacon S.A. has joined the EU-funded technology project Safecraft as a project partner and has access to a total of 265 TEUR of project funding.

While the developments are exciting, the commercial value is likely limited at this stage

We believe that through this increased ownership, Metacon will gain a larger stake in an innovative company in an exciting market with relatively little effort. While the company has not disclosed the costs associated with the investment, we believe the amount is likely to be small for Metacon and should not significantly impact its financial plans. While we do not expect this increased involvement to require substantial focus or resources from Metacon, it is crucial for the company to remain focused on projects that are closest to generating cash flow. While we see the potential of this technology as significant if successfully commercialized, the impact on Metacon's business remains to be seen, but for now it is likely to be of limited commercial value.