Europe's crucial industrial decarbonisation initiative receives a boost.

      Stegra, previously known as H2 Green Steel, has tentatively secured new financing amounting to €1.4 billion ($1.65 billion) to finalize the construction of the world’s first large-scale green steel plant in Boden, northern Sweden. The funding round is spearheaded by a consortium led by Wallenberg Investments, which includes Singapore’s Temasek and the IMAS Foundation. The Wallenberg family is set to invest €250 million, making them the largest shareholder in Stegra, while existing investor Altor will hold the position of the second-largest owner. Current shareholders Hy24 and Just Climate are also participating in the funding round, with senior and junior lenders expressing support pending credit approvals.

      This development concludes a period of severe financial uncertainty for one of Europe’s key industrial decarbonization efforts. Construction at the Boden facility had significantly slowed during the funding phase. Stegra has announced plans to accelerate activities again, although the project schedule is subject to reassessment. Initially, operations were expected to begin by the end of 2025, a deadline that has already been missed. The signing of principal agreements is anticipated by the end of April, with the financing round expected to close by June 2026.

      Leif Johansson, an advisor to the Wallenberg consortium and a notable figure in Swedish industry, highlighted both optimism and caution regarding the investment. He stated, “We believe in Stegra’s competitiveness and the market potential of green steel, alongside its climate advantages, while being mindful of the challenges ahead.” He also emphasized the project’s importance for Sweden's industrial standing.

      Following the completion of the funding round, Johansson is expected to take over as Chair of the Board, replacing Shaun Kingsbury. Håkan Buskhe from Wallenberg Investments and Paal Weberg, Managing Partner at Altor, are also likely to join the board. Johansson and Buskhe have already become board observers.

      The involvement of the Wallenberg family signifies more than just financial support; one insider remarked to the Swedish newspaper Dagens Industri, “You must view this as more than a mere investment. With the Wallenbergs’ involvement, Stegra will join the elite ranks of Swedish industry and will not be allowed to fail.” The Wallenberg investment group is known for its patient and long-term commitment to various industrial ventures in Scandinavia, holding significant stakes in companies like Ericsson, Saab, SKF, and Electrolux.

      Stegra has successfully raised over €2.1 billion in equity since its initial Series A of €86 million in 2021, followed by a Series B1 of €260 million in 2022, a €1.5 billion round in 2023—the largest private placement in Europe that year—and an additional €300 million with over €4 billion in debt financing in 2024. The project has also received a €250 million grant from the EU’s Innovation Fund. Its process employs green hydrogen generated by renewable electricity to replace coking coal in steel production, achieving up to 95% reductions in CO₂ emissions compared to traditional blast furnace methods.

      Steel manufacturing contributes approximately 7–8% of global CO₂ emissions and has historically been one of the most challenging sectors to decarbonize. Stegra's initiative has been shadowed by the fate of Northvolt, a Swedish battery manufacturer that faced bankruptcy in late 2025 despite shared early investors. Reports noted that Stegra's lenders, including Citigroup, had expressed concerns regarding the company’s future and had contemplated ceasing financial support. However, the Wallenberg funding package appears to have alleviated the immediate financial crisis, with CEO Henrik Henriksson stating that securing the funding required “significant efforts from all parties involved” amidst a “very challenging macro-environment.”