Swedish company H2 Green Steel announced yesterday that it has raised $1.6 billion in equity funding, becoming the largest private placement in Europe for 2023. The funds will be used by H2 Green Steel for the construction of a steel plant that uses hydrogen produced from renewable sources to manufacture steel with up to 95% less carbon emissions than standard industry technology.
Work on the site located in Boden, Sweden started in mid-2022 and with the runway provided by these newly secured funds, the company is on track to launch before the end of 2025.
Key investors in the project were Altor, Singapore’s GIC, Hy24, and Just Climate. Temasek and Andra AP are among the new investors in this round, joining existing investors AMF, Cristina Stenbeck, Hitachi Energy, IMAS Foundation, Kinnevik, Schaeffler, Vargas, and Wallenberg Investments’ holding company, FAM.
“The caliber of investors that are backing us is impressive. Some of the most professional institutions, investors and industrial companies globally 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 appetite to invest in us proves both our solid business case and the market demand for green steel” – Henrik Henriksson, CEO of H2 Green Steel
H2 Green Steel will construct the largest electrolyzer plant in Europe and comes after a number of rapid investment rounds ($92 million Series A in 2021, $279 million Series B1 in 2022 with $3.75 billion in debt financing in the same year).
The company also announced an agreement with Brazilian corporation Vale to explore the development of green industrial hubs in the Americas. The two companies have already signed contracts for supplying direct reduction pellets to the Boden plant with Vale expecting to reach a production capacity of 100 million tons of agglomerates (briquettes and pellets) after 2030.