Exclusive-Northvolt in talks for about 200 million euros in funding, sources say

By Anousha  Sakoui, Christina Amann and Marie Mannes

 

LONDON/FRANKFURT/STOCKHOLM (Reuters) - Northvolt is in talks with investors and lenders to secure about 200 million euros ($218 million) in short-term funding, three sources familiar with the matter said, as the cash-strapped Swedish battery maker seeks to stabilise its finances.

 

The talks have been taking place this week, one of the sources said, adding that the company still aims to raise a larger amount of capital for the long-term. The sources declined to be identified because the matter is confidential.

 

On Friday, Northvolt repeated a statement from Sept. 24 that said it had made significant progress in recent weeks in its effort to raise cash. It declined to comment further.

 

Late on Thursday, the company said it will be able to pay its taxes of 287 million Swedish crowns ($27.59 million) that fall due on Monday, responding to speculation as to whether the company would be able to do so.

 

The short-term funding may be made up of a mix of pre-orders from customers for batteries and loans as shareholders, customers and lenders all discuss forms of support, the first source said.

 

That source and a second person said there is a verbal agreement for 150 million euros in funding, but a final deal has not yet been agreed.

 

The sums involved are much smaller than the 15 billion Swedish crowns ($1.44 billion) that Swedish media had reported Northvolt was looking for a few months ago, or the 7.5 billion  crowns it was reported to be seeking last month.  

 

Northvolt announced in September that it would slim down and cut jobs, sparking fears that Europe’s best shot at a homegrown electric-vehicle battery champion may stall due to production problems, sluggish demand and competition from China.

 

Reuters reported on Thursday that the company was seeking to sell redundant battery materials to raise cash.

 

(Reporting by Anousha Sakoui in London, Christina Amann in Frankfurt and Marie Mannes in Stockholm;Editing by Josephine Mason, Elisa Martinuzzi and Catherine Evans)