Swedish electric vehicle (EV) battery manufacturer Northvolt has filed for Chapter 11 bankruptcy protection in the US.
This move is part of a strategic effort to restructure debt, scale operations and secure a sustainable foundation for continued operations, the company said.
Since its inception in 2016, Northvolt has secured approximately €10bn ($10.57bn) in funding.
This restructuring is distinct from bankruptcy proceedings in Sweden and many other countries.
In October 2024, Northvolt revealed that its Swedish subsidiary, Northvolt Ett Expansion AB, had filed for bankruptcy to reduce costs and scale back its plans for expanding battery manufacturing capacity at the Northvolt Ett Expansion project.
With the move, Northvolt will gain access to approximately $145m in cash collateral.
Additionally, one of its existing customers has committed to providing $100m in debtor-in-possession (DIP) financing.
Northvolt interim chairman of the board Tom Johnstone said: “This decisive step will allow Northvolt to continue its mission to establish a homegrown, European industrial base for battery production.
“Despite near-term challenges, this action to strengthen our capital structure will allow us to capture the continued market demand for vehicle electrification.”
The restructuring is expected to conclude in the first quarter of 2025.
During this period, Northvolt will also evaluate proposals for new investment from strategic and financial investors, existing lenders, shareholders, and customers.
The company said it will maintain normal operations, fulfilling obligations to vendors and paying employee wages.
Northvolt Ett, the flagship battery gigafactory in Skellefteå, Sweden, and Northvolt Labs in Västerås, Sweden, will remain fully operational.
Northvolt Germany and Northvolt North America, with projects in Germany and Canada, are financed separately and will operate outside the Chapter 11 process.
The Chapter 11 filings were submitted to the US Bankruptcy Court for the Southern District of Texas.
To support these proceedings, Northvolt may pursue legal actions in other jurisdictions, involving entities in the US, Sweden, and Poland.
“Swedish EV battery market Northvolt files bankruptcy in US ” was originally created and published by Just Auto, a GlobalData owned brand.
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Publish date : 2024-11-22 03:02:00
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