A total financing of approximately EUR 1.7 billion fully supports one of Europe’s most comprehensive decarbonization initiatives, securing the entire investment process for the Power4Steel project.
The financing was provided by a consortium of leading national and international banks and combines corporate and investment financing. Investment loans were guaranteed by export credit agencies OeKB (Austria) and SACE (Italy). Additionally, the German federal government and the state of Saarland contributed significant equity and direct financing under a EUR 2.6 billion program designed to support the transformation of Saarland’s steel industry.
“Climate protection, innovation, and competitiveness must go hand in hand”
Stefan Rauber, CEO of SHS – Stahl-Holding-Saar and Chairman of the Management Boards of Saarstahl and Dillinger, called the completion of the financing “an important milestone on the path toward a CO₂-reduced future.”
Rauber stated: “Following government support, the order of the main units, and the provision of initial green hydrogen volumes, the completion of the overall financing is a decisive step for the success of this unique project. We believe that climate protection, innovation, and competitiveness can go hand in hand. With Power4Steel, we are reaffirming our commitment to Germany as a production location.”
Broad international cooperation in financing
During the financing process, ING acted as documentation agent, UniCredit coordinated and represented the export credit agencies (ECA), and Deutsche Bank acted as co-ECA coordinator and loan agent.
Lazard served as SHS’s financing advisor, Hogan Lovells as legal counsel to the company, and Freshfields as counsel to the banks. SHS also thanked Rothschild & Co. for support during earlier stages.
Markus Lauer, SHS CEO and Board Member for Finance and Supply at Dillinger & Saarstahl, added: “Our financing partners have clearly demonstrated their commitment to supporting industrial decarbonization. Completing this financing represents not only a milestone for our project but also a symbol of the shared responsibility of industry, finance, and politics. It is a strong signal for the future sustainability of Saarland as a steel production hub.”
Power4Steel project: Transition to green steel in Germany
As part of the Power4Steel project, SHS Group is constructing a new direct reduction (DRI) plant and two electric arc furnaces (EAF) at its Dillingen and Völklingen sites. These new units will gradually replace the existing blast furnaces and converters.
With the shift to a hydrogen-based production system, SHS aims to reduce CO₂ emissions by approximately 55% by 2030 and achieve climate-neutral production by 2045.
Through this transformation, SHS Group aspires to become one of Europe’s largest green steel producers in the long term.
Comments
No comment yet.