Swedish battery maker Northvolt is in discussions with investors and lenders to secure approximately €200 million ($218 million) in short-term funding, according to three sources familiar with the matter. The funding, aimed at stabilising the company’s finances, is part of broader efforts to raise capital as Northvolt faces production challenges and increasing competition.
The talks have been ongoing throughout the week, with Northvolt continuing to pursue a larger long-term capital raise. “The company still aims to raise a larger amount of capital for the long-term,” said one source, who spoke on condition of anonymity. The short-term funding, however, is unlikely to be sufficient for Northvolt’s long-term needs, as noted by a second source.
Northvolt, which recently announced job cuts and a slimming down of its operations, reiterated a statement from September 24 that it had made significant progress in its cash-raising efforts. The company declined to comment further.
The short-term funding under discussion includes a combination of pre-orders from customers and loans. A verbal agreement for €150 million has reportedly been reached, though a final deal is still pending. This figure is far smaller than the €1.44 billion the company had been seeking just months ago.
Scania, a shareholder in Northvolt, is playing a key role in the discussions. “Scania is in close dialogue with Northvolt,” confirmed a Scania spokesperson, without providing further details. Meanwhile, German automaker BMW, which cancelled a $2 billion order earlier this year, is not involved in the current fundraising efforts.
Despite production struggles, Northvolt remains committed to its expansion plans, including a factory in Heide, Germany. The company has received over $10 billion in equity and debt financing since its founding in 2016 from investors such as Volkswagen, Goldman Sachs, and Blackrock.
Source: Reuters
