Northvolt raises $1.2 bln in latest funding round for factory build out - CFO
22/08/2023 09:47
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BlackRock, Canada Pension Plan back convertible note
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Omers, IMCO also help lead latest funding round
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Close to agreeing plan for Canadian factory - sources
(Adds BlackRock statement, paragraphs 5-6)
By Supantha Mukherjee and Simon Jessop
STOCKHOLM/LONDON, Aug 22 (Reuters) - Swedish lithium-ion
battery producer Northvolt has raised $1.2 billion from
investors including BlackRock BLK.N and several Canadian
pension plans as it prepares to build new factories in Europe
and North America, its finance chief told Reuters.
The fresh funding, through a convertible note, comes as
investor demand for companies set to benefit from the move to a
low-carbon economy picks up pace, aided by policy initiatives in
both regions to accelerate the transition.
"It's a very capital intensive industry... finding the right
mix is always hard in this new greenfield kind of transitional
projects," Chief Financial Officer Alexander Hartman said in an
interview.
Leading the round alongside BlackRock, the world's biggest
asset manager, were Canada Pension Plan, Ontario Municipal
Employees Retirement System and, as previously reported, pension
investor Investment Management Corporation of Ontario.
"The battery manufacturing sector has attractive growth
potential driven by the accelerating adoption of battery storage
and electric vehicles," said David Giordano, global head of
climate infrastructure at BlackRock.
"As a leading investor in the energy transition, we look
forward to supporting their continued growth."
Other investors to take part included Goldman Sachs GS.N ,
Volkswagen VOWG_p.DE , Baillie Gifford, Swedbank Robur
SWEDa.ST , Singapore's GIC and Hong Kong-based Chow Tai Fook
Enterprises.
A number of funds to invest in the note were classed as
'dark green' under the European Union's sustainable finance
framework, a stamp of environmental approval that bodes well for
future interest in the company, which ultimately hopes to list,
Hartman said.
The fresh funds will help the firm expand its factory
footprint, Hartman said. The firm currently has several
factories across Europe with the latest a 600 million euros
($654 million) investment to build a plant in Germany, announced
in May.
While the company has a facility in the United States,
sources said the company is close to finalising plans to build a
multibillion-dollar battery factory in Canada that will be
announced later this year.
Northvolt declined to comment on the factory plans.
With the latest round, Northvolt has raised more than $9
billion in debt and equity since 2017 in its bid to become
Europe's biggest battery manufacturer, including $1.1 billion in
convertible notes last year from multiple investors.
It has secured orders of over $55 billion from customers
such as BMW, Fluence, Scania, Volvo Cars and Volkswagen.
Separately, Northvolt has assembled its first energy storage
system products in Poland and expects to start customer
deliveries from later this year.
"We have a business plan... we always want to make sure we
have access to the markets," Hartman said.
He declined to comment on whether the company was preparing
to go public.
Reuters has previously reported, citing sources, that
Northvolt was preparing for an initial public offering that
could value the company at more than $20 billion.
($1 = 0.9176 euros)
(Reporting by Supantha Mukherjee in Stockholm and Simon Jessop
in London; editing by Mark Potter)
((supantha.mukherjee@thomsonreuters.com; +46 70 721 1004;
Reuters Messaging:
supantha.mukherjee.thomsonreuters.com@reuters.net))