Northvolt Cuts Workforce to 1,700 as Part of Bankruptcy Process
(Bloomberg) -- Bankrupt battery maker Northvolt AB will continue to operate in Sweden with a staff of 1,700 while its remaining employees will be laid off.
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'Despite significant reductions, it is positive that the business can continue to some extent, which is likely crucial to enabling a full or partial sale of the business,' Northvolt's bankruptcy trustee, Mikael Kubu, said in an emailed statement.
The company had a total staff of about 7,000 prior to running out of money last year following a series of operational blunders that forced it to file for bankruptcy protection in the US.
That legal process provided Northvolt with a temporary, and ultimately unsuccessful, lifeline while it sought to get its precarious finances on a stable footing. The end of the road came earlier this month when the group saw its business and assets put up for sale by a court-appointed trustee in Sweden.
Northvolt, once seen as Europe's answer to a homegrown battery champion, amassed about $10 billion in debt and equity since being founded in 2016. Multiple financing rounds across a range of instruments have created a long line of lending banks and shareholders facing the prospect of sizable losses.
The bankruptcy estates have now reached 'a principal agreement with the relevant stakeholders regarding financial guarantees to conduct the continued operations,' Kubu said, adding that the accord will be formalized in the coming days.
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