Strategy change at Northvolt: Sale of the profitable battery business

Northvolt, a Swedish flagship company in the electric battery sector, is in talks to sell its profitable battery pack business for heavy industry. An internal memo indicates that the company plans to divest this business area by the end of the year due to a lack of financial resources. This move is part of a strategy focused on strengthening the financial position and specializing in the production of battery cells, rather than being a full-service provider for battery manufacturing and recycling. Recently, Northvolt filed for Chapter 11 bankruptcy in the United States after talks for additional capital funding failed. The company needs up to $1.2 billion in long-term debt financing. As part of the bankruptcy proceedings, Northvolt plans to sell Northvolt Systems Industrial, a unit based in Poland. This unit manufactures batteries for industrial applications and is one of the few profitable business areas of Northvolt. Customers include the Swedish mining equipment company Epiroc and the Finnish engineering group Konecranes. Promising negotiations for a sale with an unidentified large industrial company have been ongoing for two months. The company is optimistic about reaching an agreement by the end of the year. If no buyer is found, the business area would have to be closed. In addition to the sale, Northvolt also plans to discontinue its energy storage business, which is also part of Northvolt Systems. These measures are to be carried out independently of the bankruptcy proceedings. If successful, Northvolt would focus on its battery factory in Skelleftea and the research and development center in Vasteraas in the future.