H2 Green Steel has successfully raised over €1 billion, marking the largest private placement in Europe this year. This substantial funding injection is earmarked for a gigawatt (GW)–scale electrolyzer project in Sweden, propelling the vision of sustainable steel production into reality.
Led by a consortium of prominent investors, including Altor, GIC, Hy24, and Just Climate, H2 Green Steel secured €1.5 billion in equity. This financial windfall is destined to underwrite the construction and advancement of H2 Green Steel’s flagship large-scale green steel facility, situated in Boden, Sweden. The groundwork for this groundbreaking endeavor commenced in the summer of 2022, with H2 Green Steel setting its sights on commencing operations by the end of 2025.
Notably, this private placement was orchestrated in collaboration with new investor Hy24, joining forces with existing backers Altor, GIC, and Just Climate. The investment consortium also welcomes new partners in the form of Andra AP-fonden and Temasek, alongside a cadre of existing investors who have reaffirmed their support for H2 Green Steel through additional equity funding. This roster includes AMF, Cristina Stenbeck, Hitachi Energy, IMAS Foundation, Kinnevik, Schaeffler, Vargas, and Wallenberg Investments holding company FAM.
The centerpiece of this ambitious venture is the green steel plant, engineered to produce steel with a staggering 95% reduction in CO2 emissions compared to conventional blast furnace technology. This remarkable feat is made possible by a paradigm shift: replacing coal in the production process with on-site hydrogen production via electrolysis, utilizing electricity generated from renewable sources.
H2 Green Steel’s CFO, Otto Gernandt, remarked, “This marks the start of industrial-scale decarbonization of basic materials production. The sector will require substantial investments over the coming decades to enable our customers to produce green end products and, thereby, meet their climate targets. We hope this financing will contribute towards accelerating the much-needed, broad participation of capital markets in the transformation of hard-to-abate industries.”
Since its inception in 2021, H2 Green Steel has demonstrated its prowess in raising capital for pioneering initiatives. To date, the company has amassed more than €1.8 billion in equity through three financing rounds. The journey began with a series A equity round securing €86 million in May 2021, followed by the successful closure of its series B1 round with €260 million in October 2022.
On the debt front, H2 Green Steel unveiled its debt financing structure, surpassing €3.5 billion in 2022, reaffirming its commitment in July 2023. Morgan Stanley played a pivotal role as the exclusive financial advisor to H2 Green Steel throughout the private placement, facilitating this groundbreaking milestone.