Inspenet, September 8, 2023.
H2 Green Steel has managed to raise around €1.5 billion in financing through a joint investment led by Altor, GIC, Hy24 and Just Climate. These funds will go to support the development of the first large-scale green steel plant in the world and the first large-scale electrolyzer in Europe.
The private placement of this investment is being coordinated by new investor Hy24, in collaboration with existing investors such as Altor, GIC and Just Climate. Additionally, this transaction includes new investors such as Andra AP – fonden and Temasek, as well as a group of investors who had already backed H2 Green Steel and continue to provide additional equity financing. Existing investors include AMF, Cristina Stenbeck, Hitachi Energy, IMAS Foundation, Kinnevik, Schaeffler, Vargas and Wallenberg Investments holding FAM.
Proceeds will go towards financing the construction and development of H2 Green Steel’s leading large-scale green steel plant, located in Boden, Sweden . Preliminary work at Boden has been ongoing since summer 2022 and through this transaction, the company takes a significant step towards the planned start of operations in late 2025.
About H2 Green Steel’s Green Steel Mill
This plant has the capacity to produce steel with a reduction of up to 95% in CO 2 emissions. compared to steel produced using conventional blast furnace technology. This is achieved by replacing coal in the production process with hydrogen, which is produced on site by Europe’s largest electrolyser, using electricity generated from renewable energy sources.
Furthermore, the incorporation of cutting-edge technology, digitalization strategies and a solid focus on circularity and recycling will make this steel plant a pioneering model in its category.
“The caliber of investors backing us is impressive. Some of the most professional institutions, investors and industrial companies worldwide are part of this round and we are proud that they all share our commitment to sustainability as their true north. €1.5 billion is the largest private placement in Europe this year and the desire to invest in us demonstrates both our strong business case and the market demand for green steel,” says Henrik Henriksson, CEO of H2 Green Steel.
“This marks the beginning of industrial-scale decarbonization of the production of basic materials. The sector will require substantial investments in the coming decades to enable our customers to produce green end products and thus meet their climate goals. We hope that this financing will contribute to accelerating the much-needed and extensive involvement of capital markets in the transformation of hard-to-downsize industries,” says Otto Gernandt, CFO of H2 Green Steel.
Since its launch in 2021, H2 Green Steel has raised more than €1.8 billion in investments through three rounds of financing. The company announced the successful closing of its series A financing round, raising €86 million in May 2021, and subsequently confirmed the closing of its series B1 round, raising a total of €260 million in October 2022.
Regarding debt financing, H2 Green Steel outlined a structure in 2022 that contemplates more than 3.5 billion euros and in July 2023 it renewed commitment letters related to this financing.