Northvolt, one of Europe’s biggest electric vehicle (EV) battery manufacturers, has filed for Chapter 11 bankruptcy in the U.S.
The Swedish company has long been one of Europe’s most valuable privately held technology firms and was viewed as developing cutting edge batteries for the auto industry and beyond.
In a news release, Northvolt said the bankruptcy filing will allow it to restructure its debt and scale back its business. The company plans to maintain normal operations during the restructuring process.
Northvolt added that the bankruptcy filing will allow it to access $245 million U.S. in new financing and $100 million U.S. of debtor-in-possession financing.
The company produces lithium-ion batteries for the electric vehicle industry, which is struggling as consumers balk at the high prices and limited battery range of current EV models.
Stockholm-based Northvolt had been seen as Europe’s best electric vehicle battery company and many investors were holding out hopes for an initial public offering (IPO) from it.
However, Northvolt has struggled to stay afloat amid mounting debt that now totals $5.8 billion U.S. with only $30 million U.S. of cash on hand.
In September, Northvolt announced plans to reduce its global workforce by 20% and its Swedish headcount by 25%.
The bankruptcy restructuring is expected to take the company a year to complete.
