SHS-Gruppe secures financing for Power4Steel transformation project

Germany’s SHS-Gruppe (Stahl-Holding-Saar Gruppe), together with its subsidiaries Dillinger and Saarstahl, has secured financing for its Power4Steel transformation project. This was announced in a statement by the company.

Power4Steel is one of the largest decarbonization initiatives in Europe.

The total package amounts to approximately €1.7 billion, which provides full financing for the entire duration of the investment project. It was secured through a consortium of leading national and international banks and combines corporate and investment elements.

The investment component is supported by the export credit agencies OeKB (Austria) and SACE (Italy). Additional financing is provided through significant contributions to the share capital and direct financial support from the German federal government and the Saarland state government as part of a €2.6 billion program to transform the region’s steel industry.

“Building on the financing commitments made by the federal and state governments, the placement of orders for the plant’s main units and the securing of initial supplies of green hydrogen, the successful completion of the overall financing package is another decisive step in advancing this unique project,” said Stefan Rauber, CEO of SHS and Chairman of the Board of Saarstahl and Dillinger.

As part of Power4Steel, a new direct reduction plant and two electric arc furnaces are being built at the production sites in Dillingen and Völklingen. They will gradually replace the existing blast furnaces and converters. Completely climate-neutral production is expected by 2045. In the long term, SHS aims to become the largest producer of green steel in its peer group.

It should be noted that SHS-Gruppe, together with its subsidiaries Dillinger, Saarstahl, and ROGESA, recently signed a 10-year contract with France’s Verso Energy for the supply of green hydrogen.