Volvo Cars has signed an agreement to acquire Swedish battery maker Northvolt’s stake in their joint venture, NOVO Energy, the automaker said on Wednesday. The financial terms of the deal were not disclosed.
The agreement marks a significant step for Volvo Cars as it seeks to secure the future of its planned battery factory in Gothenburg, Sweden. The two companies formed NOVO Energy in 2021 to develop the facility, but Northvolt’s financial struggles, including its recent bankruptcy protection filing, have complicated the venture.
See also: Northvolt Shareholders Back Operations Amid Restructuring Efforts
In October, Volvo Cars announced its intention to take over Northvolt’s stake, citing a breach of the shareholders’ agreement. The automaker also indicated it would need a new partner to keep the factory project on track.
“The framework agreement with Volvo Cars shows that market interest in Northvolt remains strong. It now opens up a path for supply opportunities in North America at Northvolt Six in Montreal,” a Northvolt spokesperson said in a statement.
See also: Northvolt Seeks $1.29 Billion from Shareholders Amid Bankruptcy Challenges
Both companies declined to comment on the financial details of the agreement. The deal is subject to approval from relevant authorities, including the bankruptcy court in Texas, where Northvolt has filed for protection.
