Sweden’s H2 Green Steel raises $1.6bn of equity for first metals plant

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 electrolyser that will supply the site with hydrogen.
The private placement, which the firm says is the largest this year in Europe, was co-led by French hydrogen investor 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 those that also bought shares, as well as Swedish pension funds.
“This is one of the last pieces in the puzzle,” Chief Executive Officer Henrik Henriksson said in an interview. “There might be a few more investors coming in which need a little bit more time, but this is the backbone.”
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. A final investment decision will be taken in the next two to three months after the final paperwork is filed with the banks who supply the debt funding, Henriksson said. Morgan Stanley & Co. International Plc was sole financial adviser in the equity funding.
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 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.