According to Reuters, on Jan 8th, shareholders of Swedish EV battery manufacturer Northvolt AB voted to continue the company’s operations during an extraordinary general meeting (EGM) in Stockholm. This decision allows Northvolt to proceed with its US Chapter 11 restructuring process as it seeks to address its financial difficulties, including debts of $5.8 billion and cash reserves of only $30 million at the time of its bankruptcy filing in November 2024. The company aims to complete its restructuring by the first quarter of 2025.
Northvolt entered Chapter 11 proceedings with a $100 million loan from shareholder Scania and plans to secure additional financing by late January 2025. The Chapter 11 process, overseen by a US court, provides the company with the framework to restructure its debts while maintaining production. Northvolt’s shareholders include major stakeholders such as Volkswagen, BMW and Goldman Sachs Asset Management. The restructuring process is expected to stabilize operations and attract new funding. Former CEO Peter Carlsson stated that Northvolt needs to raise between $1 billion and $1.2 billion through a mix of existing and new investors.
The company manufactures lithium-ion, sodium-ion, and lithium-metal batteries for applications in energy storage and e-mobility. Its flagship facility, Northvolt Ett, is located in Skellefteå, Sweden, and is a cornerstone of the EU’s EV battery ambitions. Northvolt’s financial struggles highlight broader challenges faced by Europe’s battery manufacturing industry. This company was once seen as the EU’s best hope for competing with dominant EV battery producers in China. However, production issues, reduced funding, and intense competition from Chinese manufacturers have taken a toll.
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