Geely-owned Polestar has announced that Volvo Cars has agreed to convert approximately USD 274 million of its outstanding shareholder loan into Polestar’s equity.

Following completion of the previously announced approximate USD 300 million debt-to-equity conversion by Geely Sweden Holdings AB, Volvo Cars is expected to carry out a second debt-to-equity conversion later during the second quarter, totalling approximately USD 65 million. In doing so, Volvo Cars’ ownership in Polestar will remain at approximately 19.9%.

The maturity of the remaining approximately USD 661 million shareholder loan has been extended to December 2031. The shareholder loan conversion and amendments announced strengthen Polestar’s balance sheet and extend Polestar’s debt maturity profile.

Polestar and Volvo Cars also intend to increase efficiencies by consolidating future manufacturing of Polestar 3 in Charleston, South Carolina, USA.

Michael Lohscheller, Polestar CEO, says: “We are grateful for the continued support from Volvo Cars in helping us to strengthen our balance sheet and reinforce our liquidity profile. Our strong operational collaboration with Volvo Cars continues through manufacturing, our commercial operations and offering our customers access to one of the most extensive service networks in the industry.”