Singapore sovereign wealth fund GIC, Swedish private equity firm Altor, net-zero investment platform Just Climate and hydrogen infrastructure fund manager Hy24 are among investors providing €1.5bn to finance the construction of a large-scale green steel plant in Sweden.
The private placement was issued by H2 Green Steel, a Swedish industrial start-up which had previously attracted investment from GIC, Altor and Just Climate. Hy24, a joint venture between infrastructure fund manager Ardian and FiveT Hydrogen, is a new investor.
The private placement was also backed by other new investors, including Swedish national pensions buffer fund AP2, Singapore state-owned Temasek, Swedish pension fund AMF, Swedish business woman Cristina Stenbeck, Japan’s Hitachi Energy, IMAS Foundation, which was set up by IKEA founder Ingvar Kamprad, German manufacturer Schaeffler, and Swedish investment companies Kinnevik, Vargas and FAM.
Since its launch in 2021, H2 Green Steel has raised more than €1.8bn of equity in three financing rounds. The company was founded with a plan to accelerate the decarbonisation of the steel industry, using green hydrogen.
H2 Green Steel said the funding will finance the “world’s first large-scale green steel plant and Europe’s first giga-scale electrolyzer”. The plant, which will use hydrogen instead of coal, will produce steel with up to 95% less CO2.
Henrik Henriksson, CEO of H2 Green Steel, said the €1.5bn raised 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”.
Otto Gernandt, CFO of H2 Green Steel, said: “This marks the start of industrial scale decarbonisation 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.”
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