Will Scania be able to turn thimgs around for Northvolt or will they end up sinking too?
We often see many failed ventures in the automotive world, after all, not all who start a business are meant to succeed, this is simply a sad fact of life, however, we also often see just how indominable the human spirit is as these companies that are going under will seek help from another to stay afloat. Well, Northvolt is doing just that now with Scania.
Reuters has reported that Swedish truck manufacturer Scania has announced its intention to move forward with acquiring Northvolt’s only profitable business unit for USD6 million (roughly RM26.6 million), despite Northvolt recently filing for bankruptcy. The acquisition deal, initially agreed upon in February, pertains to Northvolt Industrial, the company’s battery pack division.
Moreover, this unit, which has been operational since 2019, specialises in producing battery packs for industrial vehicles, like the ones used in drilling rigs and forklifts. Northvolt’s bankruptcy filing marks the end of Europe’s most ambitious attempt to rival dominant Asian electric vehicle (EV) battery manufacturers.
With its main operations based in Gdansk, Poland, Northvolt had been struggling for months to secure a financial lifeline, including attempts to sell off non-core assets. However, with the bankruptcy proceedings now in motion, any further asset sales have been temporarily suspended.
On top of that, according to an internal memo from Reuters, the bankruptcy trustee, who is also responsible for overseeing the liquidation process, will continue discussions with Scania and other potential buyers to explore if the sale of Northvolt Industrial can still proceed. The memo stated that it remains uncertain whether the division or its technologies will be acquired by new owners.
Northvolt had also been in talks with an unnamed consortium before this that had placed a higher bid for the business. However, Northvolt ultimately chose Scania’s offer due to the urgency of the cash flow needs. The consortium’s offer required more time for due diligence, which led Northvolt to prioritize the deal with Scania, as filings with the U.S. Bankruptcy Court revealed.
What’s more, Northvolt Industrial’s battery packs have been widely adopted in industries such as mining and construction, with notable customers including Swedish mining equipment manufacturer Epiroc and Finnish engineering group Konecranes. So will Scania be able to turn things around for Northvolt or will it sink as well? Let’s find out.
We got all this from Reuters and their full article is linked here. Thank you Reuters for the information and images.
