Swedish firm H2 Green Steel has secured €190 million (£164m) of investment in its first close of series B equity financing.
It was led by new investors AMF, GIC and Schaeffler, alongside existing investor Altor Fund V.
H2 Green Steel aims to help transform industries that generate significant carbon emissions, starting with steel, through a green hydrogen-powered steel plant in Boden in Northern Sweden.
After its launch in February 2021 and the close of its series A equity round this May, it has secured a 14TWh agreement for renewable electricity and has started construction of the plant.
Henrik Henriksson, CEO of H2 Green Steel said: “This financing milestone is a real statement of confidence in H2 Green Steel. Despite the uncertainty in global markets, a venture like ours, with both a strong business case and a strong sustainable purpose, is clearly attractive to investors.
“This financing round has allowed us to combine leading industrial companies and global financial institutions, with investors with a strong Swedish participation, creating the investor base that will set us up for success.”
H2 Green Steel has pre-sold around 60% of its initial volumes, with customers representing a broad range of sectors including steel service centres, passenger and heavy commercial vehicles as well as white goods and construction products.
Anders Oscarsson, Head of Equity at AMF added: “We appreciate the opportunity to invest in a world leading industry project with the potential to be both a good deal for our savers and an important piece of the puzzle in the transformation to a more sustainable society.
“H2 Green Steel has an ambitious strategy for establishment and growth and the outlook for a speedy start of production of the fossil-free steel that is in high demand and that is very much needed in this global shift, look very good. We look forward to following the company as active and long term owners.”