(Bloomberg) -- Battery maker Northvolt AB called a shareholder meeting Wednesday, according to people familiar with the matter, as talks to raise a targeted $300 million in emergency funding reached a critical juncture.
Northvolt didn’t describe the nature of the meeting, set for the afternoon in Europe, said the people, who asked not to be named discussing a private matter. One person characterized it as a regular meeting, while another said the invitation came at short notice.
The check-in follows a loss of momentum in talks on the bridge-funding plan for the cash-strapped electric-vehicle supplier. An agreement, seen as close to being done last month, has been delayed, one person said — weighed down by the complexity of negotiations between multiple parties and uncertainty about the market for electric cars that Northvolt supplies.
Negotiations are in a difficult phase, said a separate person. Investors and lenders have failed to reach agreement on a rescue plan despite numerous proposals, this person said. An agreement on terms of a bailout would also require sufficient support for a longer-term package, the person said.
Funding talks are ongoing, a Northvolt spokesperson said, declining further comment.
A few weeks ago, confidence was high that a deal to ease Northvolt’s cash crunch was in the final stages. One of the people said the process has been slowed partly by technical, contractual details that have generated a lot of back-and-forth between the many parties. The stakeholders are also navigating through uncertainty around EV demand, with no clear European plan and prominent political figures seeking to slow the transition from combustion-car sales, this person said.
Goldman Sachs Asset Management, Northvolt’s second-largest owner after Volkswagen AG, denied a report by Dagens Industri that it had dropped out of the talks.
“We have been actively engaged with Northvolt and all its stakeholders throughout to find a solution for the long-term future of the business,” Goldman Sachs said in an email to Bloomberg, repeating what it told the Swedish outlet. “We want Northvolt to succeed.”
Northvolt Chief Executive Officer Peter Carlsson last week said the company needed more than 10 billion Swedish kronor ($920 million) in long-term funding as it cuts back its expansion plans, sells off ancillary projects and works to increase output of battery cells in northern Sweden.
On Monday, Volkswagen’s representative to Northvolt’s board resigned, fueling concern over the strength of the two companies’ relationship. VW has said the departure of Sven Fuhrmann wouldn’t impact its Northvolt investment, without saying definitively whether it will name a replacement.
The sides are in talks over a new Volkswagen nominee to Northvolt’s board, a person familiar with the matter said.
The German carmaker also hasn’t said whether it will invest more money in Northvolt. Its Swedish truck brand Scania is one of the battery maker’s biggest customers.
Northvolt, once seen as a potential rival to the Chinese firms, has said it may have to look for an Asian partner to ramp up cell production at its main plant near the Arctic Circle in Sweden.
--With assistance from Monica Raymunt.
(Updates with short notice in second paragraph)
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