Battery manufacturer
Crucial conversations about Northvolt financing
The Swedish battery manufacturer has been in dire financial straits for a long time. Discussions regarding financing are in full swing. What happens next?
According to information from the German Press Agency, negotiations regarding the future of the Swedish company are ongoing at the financially troubled battery manufacturer Northvolt. However, the company that has started building a gigafactory in Schleswig-Holstein does not provide any official information. As the Financial Times reported over the weekend, Northvolt is trying to obtain short-term financing.
At the beginning of the year, the EU Commission approved funding and guarantees worth 902 million euros for the billion-dollar project in Heide. The federal government and the state of Schleswig-Holstein are supporting the construction of the battery factory with around 700 million euros. There are also possible guarantees for a further 202 million euros. An administrative agreement stipulates that state funds of 137 million euros should initially flow. But that hasn’t been the case so far. The federal government accounts for around 564 million.
“The country continues to see the need to build sovereign battery cell production,” said a government spokeswoman. Heide offers the best conditions for this. “The state does not comment on questions regarding the financing of the company.”
The convertible bond from the development bank KfW is a temporary liquidity aid that has to be repaid after the term, said the spokeswoman. “It has a volume of 600 million euros. Through the convertible bond, Northvolt Germany will receive more equity to enable rapid scaling.” These funds would have to be repaid later with normal market interest rates. “So this is not aid.”
Northvolt recently announced the layoffs of an estimated 1,600 employees in Sweden and put several expansion plans on hold. The focus will be on large-scale production of battery cells at the Northvolt Ett factory in Skellefteå. Since then, there has been repeated talk in Swedish media reports that the dialogue on the future financing of the ailing company is continuing. At the beginning of October, Northvolt’s Germany boss Christofer Haux made a commitment to building the battery factory in Schleswig-Holstein.
dpa
Source: Stern
