Green Steel Startup Stegra Says $1.6 Billion Funding Complete

Swedish startup Stegra, which is building Europe's first hydrogen-fuelled steel plant, said on Wednesday its €1.4 billion ($1.6 billion) financing ‌round led by a Wallenberg Investments consortium had been completed.

The financing provides a reprieve for one of the few remaining large green steel projects in Europe, where high costs and the challenges of scaling hydrogen produced using green energy have forced several planned projects to be ⁠curtailed.

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"This large-scale green project represents an important step in Sweden's competitiveness and the EU's security of supply," said Hakan Buskhe, head of special investments at Wallenberg Investments and incoming Stegra board member.

Stegra said in April it had raised €1.4 billion in new financing led by Sweden's Wallenberg family, subject to approvals, providing a lifeline for the green steel factory.

Sweden, where renewable electricity is accessible and relatively cheap, has led Europe's efforts to shift from fossil-fuel-based ‌industries ⁠to non-polluting energy.

But the country's green transition has also faced headwinds, such as the bankruptcy of battery maker Northvolt.

Stegra said in a statement on Wednesday that the financing had also received a 100% approval from the Stegra lender group, and that ⁠it would have access to undrawn debt facilities that were part of its financing round in 2024.

It said it was ramping up construction activities at its site ⁠in Boden, and that the project timeline was under review.

A separate statement outlining Stegra's new board showed its co-founder Harald Mix, who was chair until ⁠October and also co-founded Northvolt, was no longer a member.

Wallenberg veteran Leif Johansson will chair the new board.