Sweden’s H2 Green Steel AB raised €1.5 billion ($1.6 billion) of equity to help finance the world’s first large-scale green steel plant and a giga-scale electrolyzer.
(Bloomberg) — Sweden’s H2 Green Steel AB raised €1.5 billion ($1.6 billion) of equity to help finance the world’s first large-scale green steel plant and a giga-scale electrolyzer.
The private placement, which the firm says is the largest this year in Europe, was co-led by Hy24, together with existing investors including Altor Equity Partners AB and Just Climate, H2GS said in a statement on Thursday. Kinnevik AB, Vargas Holding AB, the Wallenberg family were among investors that also bought shares.
The firm is among a new breed of steelmakers seeking to overhaul the way the alloy is manufactured in one of the most polluting industries in the world. The sector, which has relied largely on the same production techniques for more than a century, accounts for about 7% of global carbon emissions.
The green production technology replaces coal in the production process with hydrogen, produced on-site with Europe’s largest electrolyzer, powered by electricity from renewable sources.
H2GS plans to start operations in 2025 at the plant in Boden in northern Sweden. Morgan Stanley & Co. International Plc was sole financial adviser.
The project is one of several major green technology projects in northern Sweden that will require huge amounts of electricity over the coming decades. There is increasing concern over energy supplies at a time when the whole economy will get electrified. Overall, demand is expected to double by 2045 compared with today.
Since launch in 2021, H2 Green Steel has raised more than €1.8 billion of equity in three financing rounds. The company closed its series A equity round of €86 million in May 2021 and announced the close of its series B1 round of €260 million in October 2022. On the debt side, H2 Green Steel announced in 2022 the structure for its debt financing of over €3.5 billion and renewed commitment letters in July this year.
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