Swedish state-owned utility group Vattenfall Group AB said Monday that it has agreed with Estonian nuclear-energy start-up Fermi Energia to become a minority shareholder of the company with a seed investment of 1 million euros ($1.2 million).

In November 2020, Vattenfall extended its continuing cooperation with Fermi Energia by signing a letter of intent to explore the possibilities for small modular reactor deployment in Estonia.

Vattenfall has now accepted the opportunity to become a minority shareholder with a 6% ownership.

"With this minority investment, Vattenfall can contribute our know-how and work jointly on feasibility studies about costing, supply chain and capabilities to construct and operate small modular reactor technology," said Torbjorn Wahlborg, senior vice president of generation at Vattenfall.

The extended collaboration will further explore the maturity of SMR technology and the prospects for deployment of one or several such reactors in Estonia until 2035, Vattenfall said.

In addition to Vattenfall, the initiative involves other European energy companies, it added.