SSAB, a Nordic and U.S.-based steel manufacturer, aims to create a stronger, lighter, and more sustainable world with its value-added steel products and services. The company has secured €2.3 billion in green financing to support its transformation project, which includes constructing a cutting-edge, fossil-free mini-mill in Luleå, Sweden.
SSAB states that this transformation project is crucial for repositioning its European operations as a producer of premium steel products, cutting production costs, and significantly reducing CO2 emissions. The €2.3 billion green financing package is backed by the Swedish National Debt Office (Riksgälden), the Italian Export Credit Agency (SACE), and the Nordic Investment Bank, with Crédit Agricole CIB structuring the deal.
SSAB decided on the EUR 4.5 billion investment in its new steel mill in Luleå during 2024 and has now signed three green loan facilities, all of which have a long-term maturity structured to support the full lifecycle of the project. The loans are structured under the Green Loan Principles, and aligns with SSAB’s Green and Sustainability-linked Finance Framework.
“The investment in Luleå will enable us to build an even stronger and more competitive SSAB by reducing costs, accelerating the product mix improvement and virtually eliminating all CO2 emissions from Luleå production,” said Leena Craelius, chief financial officer, SSAB
“The great interest to participate in the financing underscores SSAB’s leading position in the steel industry, as well as our partners’ strong confidence in our transformation plan. We managed to secure favourable terms and the package gives us the financial flexibility we need for robust implementation of the transformation, in line with our financial targets,” highlights Leena Craelius.
Crédit Agricole CIB has been acting as the global co-ordinator, Structuring Bank, and green loan co-ordinator for the financing package.
According to SSAB, the new mill’s capacity is set to feature a 2.5Mt/yr with two electric arc furnaces, advanced ladle metallurgy, and an integrated rolling mill, including a cold rolling complex, advanced galvanizing, and continuous annealing as part of the company’s strategic shift toward premium steel products in Europe. The new steel mill will be able to use a flexible mix of fossil-free sponge iron, pig iron and recycled scrap.
SSAB plans to close the current blast furnace-based production system in Luleå after the completion of the new mini-mill, which will largely remove the CO2 emissions from existing operations. The reduction is expected to be 7% of Sweden’s current CO2 emissions, as the company claims.
“We are proud to support SSAB in their transformative journey towards more sustainable production practices. Our commitment to strengthening their transformation strategy reflects not only our dedication to sustainability but also our expertise in providing tailored financing solutions,” says AndréGazal, Global Head of ECA & Multilateral Financing Solutions, Crédit Agricole CIB.