Swedish EV battery start-up Northvolt, founded by former Tesla executives, raises $ 2.75 billion in new shares – FutureCar.com


author: Eric Walz

Electric vehicle battery manufacturers around the world plan to increase production to meet growing demand for batteries from the automotive industry, especially in Europe, as automakers turn to build more electric cars. to meet EU climate targets by the end of the decade.

One of those companies is Sweden-based Northvolt AB, an electric vehicle battery start-up founded by two former Tesla executives. The company announced the signing of a $ 2.75 billion private placement to fund new battery cell production capacity and R&D efforts to meet growing demand from customers, including Volkswagen and BMW, so as automakers step up their aggressive plans for electric vehicles.

The private placement was co-led by new investors AP funds 1-4, through the co-owned company, 4 to 1 Investments, and OMERS, one of the largest pension fund companies in Canada. Existing investors Goldman Sachs Asset Management and Volkswagen Group, Baillie Gifford, Baron Capital Group and others also participated in the latest financing.

With the private placement, Northvolt has now raised more than $ 6.5 billion to support the company’s plans to expand to 150 GWh of annual generating capacity in Europe by 2030.

“We have on board a solid base of world-class investors and customers who share Northvolt’s mission to build the greenest battery in the world to enable the European transition to renewable energy. Said Peter Carlsson, co-founder and CEO of Northvolt.

Northvolt’s first gigafactory in SkellefteÃ¥, Sweden, will scale from the previous plan of 40 GWh to 60 GWh of annual production capacity in order to meet a $ 14 billion order from automaker Volkswagen that was announced earlier this year. The plant will begin production by the end of the year.

Northvolt chose the location in Sweden for its plant because of its proximity to the country’s main deposits of nickel, cobalt, lithium and graphite, which are the raw materials needed for battery production.

To date, Northvolt said it has secured more than $ 27 billion in contracts from European automakers, including Volkswagen BMW and Scania. The company also plans to build recycling capacity so that 50% of all its raw materials for battery production will come from recycled electric vehicle batteries by 2030.

“We have been producing cells at our cell industrialization facility, Northvolt Labs, for over a year and we are delighted now to bring the knowledge and technology we have developed to the north and begin large-scale production. Said Carlsson.

In order to meet its 2030 capacity target, Northvolt is currently planning to build at least two more giga factories in Europe over the next decade and is actively considering building the next one in Germany.

During the same period, Northvolt anticipates considerable growth in other parts of the European value chain for battery manufacturing; from the processing of raw materials to the manufacture of components and equipment, including the production of cells and battery systems and the establishment of recycling infrastructure.

“This is a new European industry in the making and will require significant investment over the next decade. It is encouraging to see that the investment community identified the opportunity early on, and we hope to see more investment along the value chain in the coming years. years, ”said Alexander Hartman, chief financial officer of Northvolt.

Goldman Sachs Bank Europe SE and Morgan Stanley & Co. International plc are acting as financial advisers to Northvolt.

Northvolt was co-founded as SGF Energy in 2015 by Carlsson and Paolo Cerruti, both of whom previously worked for Tesla. Carlsson was Global Head of Sourcing and Supply Chain at Tesla from 2011 to 2015 and worked alongside Tesla CEO Elon Musk for more than four years. He helped launch the Model S and managed Tesla’s supply chain with more than 300 suppliers.

Paolo Cerruti joined the company in 2016 after serving as Vice President of Global Supply Chain and Operations Planning at Tesla from March 2012 to February 2016. He is the COO of Northvolt.

SGF Energy officially changed its name to Northvolt in 2017.

Northvolt plans to continually improve battery energy efficiency, including energy density and battery cell power over the next 5-10 years.

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