Northvolt homeowners vote to remain working whereas looking for monetary rescue

By Marie Mannes

STOCKHOLM (Reuters) – The homeowners of Northvolt voted to proceed operations on Wednesday, the corporate mentioned, whereas the Swedish electrical automobile battery maker scrambles to search out new backers and funding in coming weeks.

Northvolt went from Europe’s greatest shot at an EV battery champion to looking for chapter safety final yr as manufacturing issues, dwindling funding and competitors from China took their toll.

Homeowners, together with Volkswagen (ETR:VOWG_p) and Goldman Sachs, met in Stockholm to vote on whether or not to liquidate the group or permit the Chapter 11 restructuring overseen by a U.S. courtroom to proceed.

“It is a constructive end result that demonstrates the help of our shareholders as we search to grasp our ambition and maximise our price,” the corporate mentioned in a press release.

“Northvolt continues to make progress within the restructuring course of whereas ramping manufacturing and executing on its transformation,” it added.

Northvolt has acquired greater than $10 billion in fairness, debt and public financing since its founding in 2016.

On the time of its Chapter 11 submitting in November the lithium-ion battery maker had 6,600 workers and money owed of $5.8 billion, and solely $30 million in money. It mentioned it expects to finish its restructuring by the primary quarter.

Co-founder and lately departed CEO Peter Carlsson mentioned the corporate wants to lift between $1 billion and $1.2 billion to revive its enterprise. These funds are more likely to come from a combination each monetary and strategic buyers, and a mix of current and new stakeholders, an individual with information of the scenario mentioned. The particular person was talking on situation of anonymity as a result of the matter is personal.

A Northvolt spokesperson mentioned the corporate wouldn’t touch upon potential constructions however mentioned its talks with attainable buyers had been ongoing.

Swedish corporations are required by legislation to hunt a mandate from shareholders to proceed operations if their fairness worth is estimated to have dropped under half that of their registered share capital.

“We selected to vote consistent with the Northvolt board’s proposal as the corporate’s operations proceed,” mentioned a spokesperson at insurer Folksam, which has a 0.7% stake within the startup.

Folksam’s focus is now on the result of the restructuring, the spokesperson added.

A Northvolt spokesperson had mentioned upfront that the corporate anticipated homeowners to help the board’s proposal to proceed operations.

Northvolt entered the Chapter 11 proceedings with a $100-million mortgage from shareholder and buyer Scania, and has mentioned it expects to line up extra financing by late January.

($1 = 11.1682 Swedish crowns)