Sweden-headquartered battery developer and manufacturer Northvolt has filed for bankruptcy in Sweden.

The company’s board of directors approved the move in an effort to secure a viable financial and operational future.

Following the filing, a Swedish court-appointed trustee will now oversee the process, including the sale of the business and its assets and the settlement of outstanding obligations.

Last year, Northvolt filed for bankruptcy protection in the U.S., seeking restructuring under Chapter 11 of the bankruptcy code. The move was to help the company access new funding sources, including approximately $145 million in cash collateral.

Despite these efforts, the company could not secure the necessary conditions to continue in its current form. The company faced a series of compounding challenges in recent months that eroded its financial position, including rising capital costs, geopolitical instability, subsequent supply chain disruptions, and shifts in market demand.

The entities Northvolt AB, Northvolt Ett AB, Northvolt Labs AB, Northvolt Revolt AB and Northvolt Systems AB have filed with the Swedish court. However, Northvolt Germany and Northvolt North America are not filing for bankruptcy in their respective jurisdictions.

Any decision regarding Northvolt AB’s subsidiaries will be made by the court-appointed trustee of Northvolt AB in consultation with the group’s lenders.

Tom Johnstone, Interim Chairman of Northvolt’s Board of Directors, said, “We are hopeful that the outreach we have undertaken with potential investors during the Chapter 11 process will accelerate identifying the necessary financing to allow continued trading under the Swedish bankruptcy process.”

In January 2024, the company announced the signing of a $5 billion non-recourse project financing to expand its battery gigafactory, Northvolt Ett, in northern Sweden. The new debt financing package was one of the largest green loans raised in Europe to date. It included refinancing the $1.6 billion debt package Northvolt raised in July 2020.

As the bankruptcy process unfolds, the court-appointed trustee will determine the future of Northvolt’s businesses and their assets, including technology and production facilities.