Northvolt adds $1.2bn for battery gigafactory expansion

Northvolt adds $1.2bn for battery gigafactory expansion

Business news |
By Nick Flaherty

Northvolt has raised $1.2bn to further expand its European and North American battery gigafactory operations.

This brings the total investment to over $9bn in equity and debt to deliver on over $55bn of battery orders from BMW, Fluence, Scania, Volvo Cars and Volkswagen Group.

The funding is an extension of the $1.1 billion convertible note signed in July 2022, and has attracted investment from the Investment Management Corporation of Ontario (IMCO), BlackRock and Canada Pension Plan Investment Board (CPP Investments), as well as long-term financial partner OMERS, making its third major investment in the company.

In parallel, Northvolt Dwa has assembled its first energy storage system (ESS) products in Gdańsk, Poland as part of its commissioning process.

Northvolt has been producing battery systems at a small-scale line in Gdańsk since 2019 and has now built a 25,000 square meter plant that assembles its cells into battery systems for customers in energy storage and industrial markets. Final validation of the production lines means deliveries are expected to commence later in the year.

The battery cells are currently designed and developed at Northvolt Labs in Västerås, Sweden, and Northvolt Cuberg in San Leandro, California, US. Cell manufacturing is ramping up at Northvolt Ett gigafactory, in Skellefteå, Sweden, which will be joined by an adjacent giga-scale recycling plant, Revolt Ett, due to start operations later this year. Additional projects are under development in Sweden, Germany and Portugal.

The $2.3 billion convertible round raised to date includes Goldman Sachs Asset Management, AP funds 1-4 (via the co-owned company 4 to 1 Investments), Folksam Group, ATP, Volkswagen Group, AMF, Ava Investors, IMAS Foundation, Baillie Gifford, Swedbank Robur, PCS Holding, Olympia Group, TM Capital, Compagnia di San Paolo through Fondaco Growth, East Innovate, ADQ, GIC, Chow Tai Fook Enterprises (CTFE) and J. Safra Sarasin.

“We have found a committed group of investors that understands both the urgent need and massive financial potential in enabling the swift electrification of society. However, there is a long road ahead if Europe and North America are to reach their full potential as leaders of the energy transition. To create a pathway for global warming below 1.5°C, both the private and public sector need to mobilize resources at an unprecedented scale,” said Alexander Hartman, CFO of Northvolt.

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