Northvolt: Cross-Border Chapter 11 and $100M Scania DIP

Northvolt AB entered U.S. chapter 11 on November 21, 2024 in the U.S. Bankruptcy Court for the Southern District of Texas as part of a cross-border restructuring that sought to stabilize liquidity while keeping European battery operations running. The company said nine affiliated debtors filed in the U.S. case and that operations would continue while it pursued a restructuring process, including continued customer deliveries and wage payments, according to the First Day Declaration. It also stated that Northvolt Germany and Northvolt North America were not included in the U.S. filings, highlighting the case's multinational structure and the separation of U.S. and European operating entities.

At filing, the company disclosed a severe liquidity squeeze and lined up a $100 million DIP facility from Scania under the DIP Motion, along with cash collateral access from existing secured lenders. Market reporting pointed to a sharp cash shortfall and sizable leverage, including about $5.84 billion of debt and roughly $30 million of available cash. Separate industry coverage described production setbacks and order cancellations in the months leading to the filing, including BMW's decision to cancel a EUR 2 billion order and media reports about low production output at the Skelleftea plant. Northvolt later filed for bankruptcy in Sweden on March 12, 2025, a development the company described as the result of exhaustive efforts to explore all alternatives.

Debtor(s)	Northvolt AB (and affiliated debtors)
Court	U.S. Bankruptcy Court, Southern District of Texas
Case Number	24-90577
Petition Date	November 21, 2024
Employees	~6,600 (global)
Primary Business	Battery manufacturing for EV and industrial applications
DIP Facility	$100 million term loan from Scania (multi-draw)
Cash Collateral	Access to secured lender cash collateral (final order entered)
Asset Sales	Hydrovolt equity sale and proposed Industrials Business sale
General Claims Bar Date	April 1, 2025 (later rendered inapplicable by dismissal order)
Governmental Bar Date	May 20, 2025 (later rendered inapplicable by dismissal order)

Chapter 11 strategy and case posture

The U.S. filing was structured as a complex chapter 11 case with multiple affiliates and a fast-moving liquidity package. The company sought to keep operations running while it stabilized its capital structure and pursued targeted asset sales. Early court orders authorized DIP financing, cash collateral use, and operational relief such as wage and tax payment authority, creating a framework to keep plants running during the restructuring. The court entered an Interim DIP Order and an Interim Cash Collateral Order on the petition date.

The case did not progress to a confirmed plan. Instead, the docket reflects a shift toward asset transactions and, later, a dismissal framework. On April 1, 2025, the court entered the Dismissal Order dismissing the affiliate cases, while leaving NV Texas, LLC pending dismissal procedures. That order preserved prior orders for finality but stated that bar dates set by the bar date order were no longer applicable. The case posture therefore moved from a going-concern reorganization effort into a dismissal pathway for the affiliate entities in the U.S., while the company proceeded with a separate insolvency process in Sweden.

Cross-border complexity. The restructuring strategy relied on U.S. chapter 11 protections while the core operating assets and employees were located in Europe. The company stated that the U.S. case covered Northvolt AB and several European affiliates, while Northvolt Germany and Northvolt North America continued operating outside chapter 11. The later Swedish filing underscores the dual-track nature of the restructuring, with U.S. proceedings addressing creditor protections and financing while Swedish courts handled bankruptcy administration for core operating entities.

Northvolt's Swedish filing added a second layer of insolvency administration. The company said the board filed for bankruptcy in Sweden after exploring all available alternatives and that a Swedish court-appointed trustee would oversee a sale of the business and assets. The press release identified the principal Swedish entities included in the filing and said Northvolt nominated Mikael Kubu as trustee, while Northvolt Germany and Northvolt North America did not file in their jurisdictions. Subsequent reporting indicated further operational contraction, including the May 2025 decision to discontinue production at the Skelleftea plant and planned job reductions.

Cash needs framed the case. Public reporting around the filing indicated the company was down to roughly about $30 million in cash and carried debt of about $5.84 billion. Bloomberg Law and Global Restructuring Review coverage described the DIP facility as a lifeline that allowed the company to access immediate liquidity while negotiating with secured lenders and other stakeholders.

Company background and European footprint

Northvolt positioned itself as a European battery champion focused on building a regional supply chain for lithium-ion cells and storage solutions. The company described a multinational footprint anchored in Sweden, with operations spanning R and D, cell manufacturing, module and pack assembly, and recycling. Its press release on the U.S. filing described the debtor group as including Northvolt AB, Northvolt Systems AB, Northvolt Poland, Northvolt Revolt, Northvolt Labs, Cuberg, NV Texas, Northvolt Ett, and Northvolt Ett Fastighetsforvaltning. That list of entities reflected a corporate structure built around manufacturing and development sites across Sweden, Poland, and the U.S.

The First Day Declaration describes a large-scale manufacturing strategy intended to reduce European dependence on Asian battery supply. The company reported an employee base of roughly 6,600 across seven countries and described major sites including the Skelleftea gigafactory (Northvolt Ett), the Vasteras research and development center (Northvolt Labs), and Polish operations tied to module and pack assembly. The filings also described the Hydrovolt recycling joint venture in Norway, positioning recycling as part of the integrated supply chain.

The company reported significant external support and investment across its expansion. The European Investment Bank disclosed a lending package of just over $1.038 billion to support the Skelleftea gigafactory, alongside Swedish and EU guarantees. Northvolt also raised major equity rounds, including a EUR 2.75 billion raise in 2021 and a further $1.1 billion funding injection in 2022.

PRNewswire reported that the company secured about $245 million of financing support at the time of the U.S. filing, including the Scania DIP. The same release described Scania as Northvolt's largest single customer and a key shareholder, underscoring the overlap between customer relationships and capital providers.

Selected investor and creditor exposure. Public reporting provides a snapshot of equity and creditor exposure at major stakeholders. Sifted and Morningstar reported positions for Volkswagen, Goldman Sachs, and other investors, alongside creditor exposure figures for public banks and project lenders.

Shareholder and creditor base. Coverage of the case highlighted a complex investor and lender mix. Sifted reported that Volkswagen held a roughly 20% stake and had invested about EUR 1.4 billion, while Goldman Sachs held about 19% and was preparing to write down its investment. The same coverage identified large creditor exposures, including reported claims by Volta Vision and KfW. These figures underscore the breadth of financial stakeholders with exposure to the restructuring.

Customer relationships and order book. Northvolt disclosed long-term supply commitments, including deals with major automakers. Industry reporting noted that the company had signed supply agreements valued at around $27 billion, and that BMW and Volkswagen were key partners. The loss or renegotiation of major supply agreements was significant for cash flows and financing expectations. The June 2024 cancellation of BMW's EUR 2 billion order was widely reported and became a prominent datapoint in assessing Northvolt's demand outlook.

Liquidity crisis and capital structure pressures

Court filings and external reporting describe a liquidity crisis driven by capital intensity, delayed ramp-up, and uneven demand. The company said battery manufacturing required large front-loaded investment and that profitability had not yet been reached. It also reported that a 2023 EV demand slowdown and competitive pressure in the battery market constrained revenue and pricing. This led to a short-term liquidity position that became critical by late 2024.

Public reporting emphasized the mismatch between capital outlays and cash generation. The company disclosed that it had raised around about $15 billion since its founding in 2016, yet still faced a severe cash deficit at filing. Carscoops and Euronews both cited approximately $5.84 billion in debt and about $30 million in available cash. The company also faced ongoing funding requirements; Transport Topics reported that leadership said the business needed at least $1 billion to continue long-term operations.

Bruegel reported that quality problems and high reject rates persisted after initial production, with cell output well below plan and rising costs. The same report linked production setbacks to the broader investor and customer concerns that culminated in the BMW order cancellation. These issues amplified the liquidity challenge because output shortfalls limited the company's ability to convert invested capital into revenue.

Liquidity and leverage snapshot. Public reporting around the filing cited a short runway and heavy leverage. The table below summarizes figures cited in media coverage and company releases.

Operational challenges were also part of the distress narrative. High North News reported that the Skelleftea plant delivered less than 1% of its 16 GWh capacity in 2023 and produced only about 80 MWh in the first three quarters of the year, indicating a slower-than-expected ramp. Norran reported internal engineering and process issues, including equipment problems and material waste, as well as reliance on imported cathode material and machinery. These reports highlight how production reliability and quality challenges intersected with liquidity constraints.

Leadership changes. The filing coincided with leadership turnover. Transport Topics reported that CEO Peter Carlsson resigned hours after the chapter 11 filing and that CFO Pia Aaltonen-Forsell assumed the interim CEO role. Carlsson stated publicly that the company had been over-ambitious in its production expansion and that it should have slowed certain expansion paths earlier, signaling management acknowledgment of execution risk.

Sifted reported that the U.S. filing followed governance changes, including leadership transitions at Northvolt Ett, and that the company faced investor pressure after the BMW cancellation. Energy Now characterized the BMW order cancellation as the event that started the countdown to the chapter 11 filing, framing the demand shock as a key moment in the liquidity trajectory. These reports provide external context for how stakeholder perceptions shifted in parallel with the operational and liquidity challenges described in court filings.

External funding and policy context. Northvolt's capital stack included public and quasi-public funding sources, such as EIB lending and guarantees, and other government-backed programs. Euronews reported that EU exposure under the European Fund for Strategic Investments amounted to about $313 million, which could imply broader public-sector exposure if recoveries fall short. These financing structures are typical for large industrial projects but can add complexity to restructuring negotiations.

DIP financing and cash collateral structure

The DIP facility and cash collateral arrangements were central to the U.S. restructuring. Court filings describe a Scania-provided DIP facility structured as a senior secured, superpriority term loan with multiple draws. Bloomberg Law and Global Restructuring Review both reported that Scania provided the $100 million DIP facility and that the Texas court authorized access to that financing while allowing continued use of cash collateral.

DIP facility structure. The DIP Motion describes a term loan that provided a $51 million initial draw at the interim order stage, with additional draws of $25 million and $24 million after entry of the Final DIP Order, subject to milestones and a termination date. The DIP carried a stepped interest rate, rising after mid-February 2025, and included fees payable at the first draw and upon repayment. The facility also included a collateral package that mixed first-priority and second-priority liens on specified assets, and restrictions on use of proceeds outside an approved budget.

Cash collateral order. The Final Cash Collateral Order quantified prepetition secured obligations and provided adequate protection liens to lenders. The order also recognized DSRA cash as cash collateral, subject to a mechanism allowing a superpriority intercompany loan to fund Northvolt AB. The budgeting framework required bi-weekly variance reporting and constrained spending to approved operating budgets.

Court filings quantified prepetition secured debt at the project level, including approximately $1.223 billion of first lien obligations and about $404.7 million of second lien obligations, plus accrued interest. These amounts framed the cash collateral protections and the allocation of sale proceeds, and they informed the budgeting and milestone requirements tied to asset sale processes.

Coverage of the DIP package also emphasized the immediate liquidity bridge it provided. Bloomberg Law reported that Scania provided the $100 million DIP facility and that the restructuring process opened access to an additional $145 million of cash collateral, while Global Restructuring Review described the financing as supporting continued production at Northvolt Ett during the chapter 11 process. This reporting aligns with the structure of the DIP and cash collateral orders in the docket, which tied liquidity access to milestones and operating budgets.

The DIP and cash collateral framework reflects the limited runway and the need for tight governance over cash usage. A central feature was the budget and milestone structure, which aligned liquidity with asset sale processes. Court filings describe milestones relating to asset transactions such as the Hydrovolt equity sale and the Industrials Business sale process, highlighting the connection between liquidity access and transaction execution.

Asset sales and restructuring transactions

The U.S. case pursued targeted asset sales rather than a full enterprise sale. Two transactions were particularly prominent: the sale of Hydrovolt shares and the proposed sale of the Industrials Business to Scania. These transactions were structured as equity or share sales rather than traditional U.S. asset sales, reflecting the European corporate structure and the need to transfer non-U.S. assets.

Hydrovolt share sale. The court entered the Hydrovolt Sale Order approving a private sale of Northvolt Revolt AB's equity in Hydrovolt AS to Hydro Energi Invest AS. The transaction involved 1,155,000 shares and a purchase price of NOK 78.4 million. The sale order provided for a free-and-clear transfer and allowed DIP liens and adequate protection liens to attach to the proceeds. The order also included a good-faith purchaser finding under section 363(m).

Hydrovolt was positioned as a recycling joint venture tied to Northvolt's circular supply chain thesis. The sale therefore reflected a strategy to monetize a non-core stake to preserve liquidity, while maintaining focus on core cell manufacturing and customer deliveries during the restructuring.

Industrials Business sale process. The debtors filed an Emergency Sale Motion seeking approval for a private sale of the Industrials Business to Scania. The motion described the business as a unit focused on battery modules and packs for off-highway industrial applications. The proposed structure involved a sale of ownership interests in a newly formed Swedish entity with a Polish subsidiary. Consideration included approximately $6 million in cash before closing adjustments and assumption of about $10.5 million in liabilities.

Transaction timeline and urgency. Court filings describe a marketing process initiated in September 2024 that generated limited bids and ultimately led to the Scania transaction. The debtors framed the sale as a liquidity-driven transaction needed to preserve value and avoid a forced shutdown. The proposed sale also included settlement mechanics for certain liabilities, such as amounts associated with Epiroc, reflecting the need to align trade counterparties with the transaction structure.

Broader restructuring context. While these asset sales were active, the company pursued a broader strategic reset. PRNewswire reported that the company secured approximately $245 million in financing support and that Scania was both a major customer and key shareholder. This dual relationship influenced the restructuring because Scania served both as a commercial partner and a capital provider.

Claims process, bar dates, and dismissal order

The court entered the Bar Date Order on February 12, 2025 establishing a general claims bar date of April 1, 2025 at 5:00 p.m. Central Time and a governmental bar date of May 20, 2025 at 5:00 p.m. Central Time. The order also set deadlines for rejection damages claims and for claims arising from amendments to the schedules. The order required notice by mail or email to known parties and publication notice in The New York Times (national edition), The Financial Times (international edition), and the Official Swedish Gazette.

The Dismissal Order entered April 1, 2025 altered the claims process. The court dismissed the affiliate cases and provided that bar dates set by the bar date order were no longer applicable. The order preserved prior orders for finality and res judicata purposes, but effectively removed the claims filing deadlines as a governing framework once the dismissal took effect. The order also provided a pathway to dismiss the remaining NV Texas, LLC case after a notice of dismissal is filed.

The order did not unwind the DIP, cash collateral, or sale orders already entered. Instead, it preserved those orders while ending the U.S. claims administration framework, shifting remaining claim resolution to other venues and processes.

The Claims Agent Order authorized Stretto to serve as the repository for proofs of claim, maintain the official claims register, and provide electronic filing access. These functions were standard for large, multi-debtor cases but became less central once the dismissal order removed the bar date framework.

Key case timeline

Frequently Asked Questions

Why did Northvolt file for chapter 11 in the United States?

The company said the U.S. filing was intended to provide access to DIP financing and cash collateral while it pursued a restructuring. A company press release stated that nine affiliated entities filed in the U.S. and that operations would continue during the restructuring. Court filings describe a severe liquidity shortfall, and media coverage reported that the company had about 30 million in cash against a debt load of about 5.84 billion.

What happened after the U.S. filing?

The court approved a $100 million DIP facility from Scania and allowed use of cash collateral, while the company pursued asset sales and restructuring milestones. The case then moved toward dismissal. An April 1, 2025 order dismissed the affiliate cases and provided a procedure to dismiss the remaining NV Texas case, while preserving prior orders for finality. The dismissal order also stated that the bar dates set by the bar date order were no longer applicable.

What drove the liquidity crisis?

Management and market reports pointed to a combination of capital intensity, production ramp delays, and demand volatility. Industry coverage noted that BMW canceled a EUR 2 billion order in June 2024, and High North News reported that the Skelleftea plant delivered less than 1% of capacity in 2023. The company reported that EV demand softened in 2023, while competitive pricing pressure increased.

How large was Northvolt's funding base before bankruptcy?

Northvolt reported that it raised around about $15 billion since inception. It also completed large equity rounds, including a EUR 2.75 billion raise in 2021 and a further $1.1 billion funding injection in 2022.

What were the main terms of the DIP financing?

Court filings describe a $100 million senior secured, superpriority term loan provided by Scania with multiple draws. The facility contemplated a $51 million initial draw at the interim order stage and two additional draws of $25 million and $24 million after entry of the final order, subject to milestones and a March 31, 2025 termination date. Pricing stepped up from 16% to 18% per annum after mid-February 2025, and the facility included fees payable at first draw and upon repayment. The DIP was secured by a collateral package that included first priority liens on specified collateral and second priority liens on other pledged assets, with proceeds restricted to an approved budget.

Did Northvolt continue production after the filing?

The company stated at filing that it intended to continue operations and customer deliveries during the restructuring, and its U.S. press release emphasized ongoing wage payments and plant operations. Later in 2025, Electrive reported that Northvolt discontinued production at the Skelleftea plant and planned to shut the factory by the end of June, indicating that operational continuity was not sustained through the later stages of the restructuring.

What were the key asset sales in the U.S. case?

The court approved a private sale of Northvolt Revolt AB's shares in Hydrovolt AS for NOK 78.4 million, and the debtors sought approval for a sale of the Industrials Business to Scania. These transactions were structured as equity or share sales to match the European corporate structure and to transfer non-U.S. assets while retaining U.S. court oversight.

How did the Swedish bankruptcy relate to the U.S. case?

Northvolt filed for bankruptcy in Sweden on March 12, 2025, and a company press release said the board pursued the filing after exhausting other options. The press release stated that Northvolt AB, Northvolt Ett, Northvolt Labs, Northvolt Revolt, and Northvolt Systems filed in Sweden, while Northvolt Germany and Northvolt North America did not. This created a two-track process: dismissal of U.S. affiliate cases and a Swedish bankruptcy for core operations.

Were there later asset outcomes after the Swedish filing?

In August 2025, Lyten announced a binding agreement to acquire Northvolt's remaining assets in Sweden and Germany, including Northvolt Ett, Northvolt Labs, and Northvolt Drei. The announcement described assets previously valued at about $5 billion and included intellectual property and production capacity.

Who is the claims agent for Northvolt AB?

Stretto, Inc. serves as the claims, noticing, and solicitation agent. The firm maintains the official claims register and provides notice and claims administration services.

See more Chapter 11 case summaries in the ElevenFlo blog.