Foresight Environmental Infrastructure Ltd announced on Friday that its partner in Germany’s green hydrogen sector is expected to enter administration.

The Guernsey-registered company is an environmental infrastructure investment fund with a portfolio of assets located across the UK and Europe. Foresight Environmental has invested a total of 2.6% of its net asset value as at June 30, €22.3 million, in German green hydrogen partner HH2E AG.

Foresight Environmental’s investment in HH2E has primarily supported the early development of two green hydrogen sites in Lubmin and Thierbach, both of which now require additional funding to advance to the construction phase.

Foresight Environmental said that HH2E has pursued third-party financing to further its development pipeline and initiate construction at the Lubmin site. However, the search for a suitable financing partner did not secure the necessary support, and there remains uncertainty over whether adequate funding can be achieved.

Foresight Environmental, along with its investment manager Foresight Group, considered providing additional funding to sustain HH2E, but the board ultimately decided against further investment.

Foresight Environmental anticipates that, lacking necessary funding, HH2E’s management will proceed with filing for insolvency and enter administration. Foresight Environmental does not expect to recover its invested amount under German insolvency law.

Foresight Environmental reaffirmed it expects to hit its dividend target of 7.80 pence per share for the year to March 31, with expected coverage in the range of 1.2 to 1.3 times. In financial 2024 Foresight Environmental paid a dividend of 7.14 pence per share.

Foresight Environmental also announced on Friday the buy back of 150,000 ordinary shares at a price of 84.80p per share, adding these shares to its treasury holdings.

Foresight Environmental shares fell 6.3% to 79.50 pence each in London on Friday afternoon.

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