Hyzon Motors, a global supplier of hydrogen fuel cell-powered heavy vehicles, disclosed in a regulatory filing Wednesday it has received a subpoena from the Securities and Exchange Commission (SEC) regarding allegations raised in a short seller report in late September.
According to Hyzon, the SEC is seeking the “production of documents and information, including related to the allegations made in the report issued by Blue Orca Capital.” Hyzon said it is cooperating with the SEC.
The details: Blue Orca Capital published its report Sept. 28, shortly after Hyzon in July announced its going public via Decarbonization Plus Acquisition Corp., a special purpose acquisition company (SPAC).
Blue Orca’s report concerns, among other matters, three main allegations:
- Hyzon’s largest customer, Shanghai Hydrogen HongYun Automotive, is a “fake-looking Chinese shell entity” formed three days before the deal was announced;
- Hyzon’s second largest customer, Hiringa Energy, is “not really a customer” but rather a channel partner; and
- Hyzon “overstated orders and financial projections” after some big-name customers disappeared from its investor presentations.
Hyzon response: In a statement issued Oct. 5, Hyzon Chief Executive Officer Craig Knight said the report is “inaccurate and misleading, and we believe it was intended solely to generate profits on Blue Orca’s short position at the expense of Hyzon’s long-term shareholders.”
“Hyzon has no record of this short seller ever meeting with Hyzon management, requesting any information or clarification from Hyzon, or otherwise seeking to verify any of its claims, which would have been expected given the inflammatory and grossly inaccurate statements made in the report,” Knight added. “We stand by our public disclosures, and we expect Hyzon’s performance will speak for itself.”
Addressing each allegation, Hyzon said it “specifically disclosed” in its Sept. 9 announcement regarding the non-binding memorandum of understanding it entered with Shanghai HongYun that the company “was not yet a customer of Hyzon.”
Regarding Hiringa, the company stated, “Hyzon has never suggested that Hiringa is an end user of hydrogen trucks. Instead … the partnership between the companies is intended to accelerate the decarbonization of heavy transport in New Zealand through the buildout of hydrogen infrastructure and the supply of fuel cell electric trucks and buses.”
Third, Hyzon said the report “misleadingly” claims it overstated its relationship with certain customers in investor presentations.
“Contrary to the short seller’s claims, no customers or potential customers ‘disappeared’ from any investor presentation; rather, Hyzon anonymized certain customer and potential customer names in its July 2021 investor presentation,” the company stated.