Hy24 confirms participation in the new financing round of the green project Stegra

French hydrogen technology investor Hy24 has confirmed its participation in a new round of financing for Swedish startup Stegra AB (formerly H2 Green Steel), which is building the world’s largest green steel plant. The company is raising up to €975 million in investments to cover higher-than-expected construction costs, infrastructure development, and compensation for delays in government grants, Bloomberg reports.

According to Hy24 co-founder and CEO Pierre-Etienne Franck, the project remains viable despite the difficult financial situation.

“There is no reason to doubt Stegra’s success; its foundations are very solid. Moreover, demand for green steel has only grown since its launch,” he said.

The plant, located north of the Arctic Circle in Sweden, is currently about 60% complete. It is cited as a prime example of the steel industry’s transformation towards a complete shift away from fossil fuels. Since its inception, Stegra has raised approximately €6.5 billion in equity, debt instruments, and grants.

Hy24 also participated in the previous round of financing in September 2023, when €1.5 billion was raised together with partners Altor Equity Partners, GIC, and Just Climate.

Despite similar projects around the world facing delays or cancellations, Hy24 and Stegra remain confident in the future of the plant. Stegra founder Harald Mix, as well as investors Altor Equity Partners and FAM AB, have also confirmed their participation in the new round.

“We need to secure funding quickly to maintain the momentum of the project,” Frank concluded.

As a reminder, Stegra recently appointed a restructuring expert to its board of directors as the company struggles to avert a financial crisis. The startup is already being compared to the bankrupt Northvolt.

The company reported operating losses of just over SEK 2 billion ($209 million) for 2024, compared to SEK 657 million a year earlier.