Struggling battery manufacturer Northvolt has raised a small amount of fresh capital, sufficient to ensure that employee salaries are paid at the end of this week. Simultaneously, discussions are underway regarding a larger support package that could exceed $300 million by the end of the month, according to internal sources cited by the Swedish publication Dagens industri. This potential funding would bolster Northvolt’s liquidity into the coming year.
According to a report by Bloomberg, Goldman Sachs’ investment subsidiary is considering collaborating with other investors to assist Northvolt, with a commitment dependent on additional backing. Goldman Sachs Asset Management, the company’s second-largest shareholder, is actively seeking solutions to Northvolt’s liquidity crisis.
A few days prior, Northvolt announced progress on the financing package, stating that it is “intensively” working toward a resolution. Co-founder Harald Mix disclosed that he has personally provided more than 1.5 billion Swedish kronor (approximately 130 million euros) in new capital.
The situation at Northvolt has deteriorated since the summer, when BMW, a key shareholder, canceled a significant order for battery cells due to delays. BMW has shifted its focus to cylindrical cells for its upcoming electric vehicles in the “Neue Klasse.” This order cancellation prompted CEO Peter Carlsson to acknowledge that his expansion plans had been “a little too aggressive,” leading to a renewed focus on supplying customers from Northvolt’s first Gigafactory in Skellefteå while revisiting expansion strategies.
The company has undergone a series of changes recently, including the appointment of a new CFO, Pia Aaltonen-Forsell, in July. Her predecessor, Alexander Hartman, is tasked with revising the company’s expansion plans as Chief Transformation Officer. As part of its restructuring, Northvolt has closed its California research center, which it acquired in 2021, and deprioritized ancillary businesses such as cathode material production and battery storage to concentrate on its core battery cell production.
In a significant move, Northvolt announced the reduction of 1,600 jobs across three Swedish sites, representing 25% of its workforce in those locations and 20% of its total workforce. The subsidiary responsible for the planned factory expansion, Northvolt Ett Expansion AB, has also filed for insolvency.
Source: di.se
