Kinnevik has written down the value of its stake in Stegra by 49 per cent to 649 million krona in the fourth quarter from 1,280 million krona in the third quarter. Kinnevik holds a three per cent stake in Stegra.

Stegra is developing fossil-free steel using hydrogen. The company is looking to complete $1.1bn in financing to complete the construction of the plant in northern Sweden.

Kinnevik said that despite the positive development of a multi-year contract with ThyssenKrupp Materials Services, the current funding round reflects a higher project cost than previously expected, causing a potential economic dilution of its investment. The Stegra plant, initially due to open this year, has now been delayed until 2027.

Stegra has raised €6.5bn from investors, including Mercedes-Benz, Siemens, the Agnelli family, and the Singaporean sovereign wealth fund GIC. According to the Financial Times, Citigroup is considering stopping being a lender to Stegra over concerns about its future.

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