Plug Power (NASDAQ:PLUG) has spent the past year working to expand its supply of green hydrogen production and increasing the use of hydrogen as a fuel. Plug Power has partnered with several overseas companies in the process, and one of them announced a deal with a competitor today. Investors see that as good news for Plug Power, and drove its shares up 6.2% as of 2:50 p.m. EDT.
In February 2021, Plug Power completed a deal with SK Group that will give the South Korean industrial company a 9.6% stake in Plug Power with a $1.6 billion investment. Today, a subsidiary of SK Group and fuel cell company Bloom Energy (NYSE:BE) announced a separate deal to continue investing in the hydrogen economy. While shares of Bloom soared on the news, it is also viewed by investors as a positive development for Plug Power.
The deal Bloom Energy announced with SK ecoplant doesn't directly impact Plug Power. But it could help benefit the company in several ways. Plug Power's own deal with SK Group resulted in the formation of a joint venture "designed to accelerate the use of hydrogen as an alternative energy source in Asian markets." Today, Bloom and SK said they plan to set up hydrogen innovation centers, including one in South Korea.
That coincides with Plug Power's goal to "establish a gigafactory in Korea by 2023 to produce fuel cells and electrolyzers, and later provide them in broader Asian markets with a substantial cost reduction."
At the same time, Plug Power has been working to build green hydrogen facilities in several locations throughout the U.S. Anything that helps promote the use of hydrogen fuel in the U.S. -- or in Asia, as today's announcement does -- should be a positive for all companies in the sector. Plug Power investors recognized that today, and boosted the stock as a result.