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H2 Green Steel, a Swedish steel manufacturer, has raised €4.75 billion ($5.17 billion) in new funding for its planned flagship plant in the northern Swedish town of Boden, which will be the world's first large-scale green steel project.
The company, founded in 2020, has signed debt financing of €4.2 billion, added equity of close to €300 million from investors and been awarded a €250 million grant from the EU Innovation Fund, it said in a statement on Monday.
Total funding for the plant amounts to €6.5 billion, said the company, which raised equity funding of about €1.5 billion last year.
"No one has scrutinised our project more thoroughly than those who back our financing," H2 Green Steel CEO Henrik Henriksson said in the statement.
"This massive commitment from our lenders, investors and the Innovation Fund is true recognition of the quality of our company," he added.
New shareholders include the Microsoft Climate Innovation Fund and Siemens Financial Service. H2 Green Steel's existing owners include Altor, GIC, Just Climate, Andra AP Fonden, Hy24 and Temasek.
The company has said that the Boden plant will use hydrogen produced from renewable electricity - rather than coal - to deliver steel in a process emitting as much as 95% less CO2 than steel produced with traditional blast furnace technology.
Half of the initial yearly volumes of 2.5 million tonnes of steel have been sold in binding five- to seven-year customer agreements, the group said on Monday.
Legal and financial advisers for the latest funding round include Milbank, Mannheimer Swartling, Societe Generale and KfW IPEX-Bank, while Morgan Stanley acted as equity adviser.
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