Northvolt has signed a US$600m private placement, led by Baillie Gifford, Goldman Sachs Merchant Banking Division and Volkswagen.

The deal enables the company to make further investments in expanding its production and recycling capacity as well as R&D activities to support the target of establishing 150 GWh of manufacturing capacity in Europe by 2030.

In the private placement, a new group of international institutional investors joins as Northvolt shareholders: Baillie Gifford, Baron Capital Group, Bridford Investments Limited, Norrsken VC & PCS Holding.

Private investors, Cristina Stenbeck and Daniel Ek also participate in the equity raise together with existing Northvolt shareholders, Goldman Sachs Merchant Banking Division, IMAS Foundation, Scania and Volkswagen.

“We are in the middle of a race to establish manufacturing capacity in Europe and I believe the companies that are best at attracting talent and capital, while scaling their blueprints the fastest, will be the most successful,” said Northvolt co-founder and CEO, Peter Carlsson.

“With these partners behind us, we have created a solid foundation to go on and execute our plans to enable large-scale manufacturing of green batteries in Europe.”

The private placement will enable Northvolt to make further investments in three key areas:

  • Increasing production capacity of battery cells and systems to support the goal of establishing 150 GWh of manufacturing output in Europe by 2030
  • Expanding the Northvolt Labs Campus, where the company’s R&D activities take place. Northvolt Labs is expected to double in size during the coming years in terms of investment and footprint
  • Establishing a giga-scale lithium-ion battery recycling facility next to the Northvolt Ett gigafactory. The facility will become the largest in the world with an initial capacity of 4 GWh, and the only large-scale facility in Europe capable of recycling lithium in addition to cobalt, nickel, manganese and other metals

The Northvolt Ett gigafactory in Skellefteå, Sweden, with a potential annual output of 40 GWh, is being constructed and scheduled for start of production in 2021. In parallel, the permitting process is underway for Northvolt Zwei in Salzgitter, Germany, which is scheduled to start operations in 2024 with an initial output of 16 GWh.

Collectively, these initiatives will facilitate Northvolt’s target of a 25% market share in Europe by 2030, equalling around 150 GWh of commissioned annual production capacity, with 50% of its raw material coming from recycled batteries.

Goldman Sachs International and Morgan Stanley & Co. International act as financial advisors to Northvolt.