H2 Green Steel receives €3.5 billion debt financing

H2 Green Steel has received support from leading European financial institutions for its €3.5 billion debt financing.

H2 Green Steel will finance the construction of its hydrogen-powered green steel plant in Northern Sweden through a combination of equity and debt financing. The debt financing support consists of the following:

H2 Green Steel has executed conditional commitment letters for €3.3 billion in senior debt with AB Svensk Exportkredit (SEK) and the commercial banks BNP Paribas, ING, UniCredit, Societe Generale and KfW IPEX-Bank.

The European Investment Bank has received board approval for €750 million of senior debt funding for the H2 Green Steel project.

Leading export credit agencies, including Euler Hermes, have issued letters of intent to provide export credit-linked guarantees of €1.5 billion of H2 Green Steel’s intended senior debt.

The Swedish National Debt Office has issued a letter of intent to provide a green credit guarantee of €1 billion for H2 Green Steel’s senior debt.

H2 Green Steel has executed a conditional commitment letter with a leading infrastructure fund comprising large Nordic investors in connection with their lead participation in a circa €500 million junior debt facility.

It represents a strong statement of support of H2 Green Steel’s ambition to reduce carbon emissions in hard-to-abate industries, as well as the technical and economic merits of the Boden green steel plant by some of the world’s leading financial organizations.

The commitment letters and approvals remain subject to inter alia to completion of final due diligence and documentation, with a further round of syndication anticipated given the substantive interest in the financing from a wide range of other commercial banks and investors.

Henrik Henriksson, H2 Green Steel’s CEO, said, “The support from the European Investment Bank, Swedish National Debt Office and some of the world’s leading export credit agencies and banks, not only underlines our business case and debt carrying capacity, but also highlights the willingness to support initiatives that will help fulfil the target of the Paris agreement.”