Porsche intends to dominate the ownership of Varta's battery division in a significant manner
In a significant move aimed at reducing Europe's dependence on Asian battery cell suppliers, luxury automaker Porsche has announced plans to become the majority owner of V4Drive. The German production facility for booster cells, located in Nördlingen, is a crucial part of V4Drive's operations.
The Nördlingen facility, expected to commence production in 2025, is set to play a key role in Porsche's ambitious plans. Varta, the current owner of V4Drive, has secured 100 million euros from a capital increase enabled by the Porsche deal. This infusion of funds is expected to bolster Varta's financial position and facilitate the successful implementation of its financial restructuring.
Varta, however, has faced challenges in its investments in promising business models, leading to insufficient earnings. As part of its debt restructuring process, known as a "debt haircut", the company aims to reduce its debt from 485 million euros to 200 million euros. To aid in this financial reorganization, Porsche is set to invest 30 million euros in Varta.
Lutz Meschke, finance and IT executive board member at Porsche, stated that the planned majority takeover of V4Drive aims to drive the company forward and keep key technologies in Germany. Dr. Michael Tojner, chairman of Varta's supervisory board and majority shareholder, echoed this sentiment, asserting that the company offers potential to reduce Europe's dependence on Asian battery cell suppliers.
The agreement between Varta and Porsche also secures the stability of VARTA AG and paves the way for a new start. Varta has also secured a senior secured loan to improve liquidity. However, the specific timeline for the closure of the deal has not been provided in the release.
The Nördlingen facility produces large-format lithium-ion round cells, which are used in the hybrid Porsche 911 Carrera GTS. The production of these booster cells is expected to contribute to reducing Europe's dependence on Asian battery cell suppliers and bolster Porsche's commitment to sustainable mobility solutions.
The majority takeover of V4Drive by Porsche is subject to antitrust approvals in various countries and the successful implementation of Varta's financial restructuring. Once completed, this partnership is poised to strengthen Germany's position in the global battery cell market and support the growth of the European electric vehicle industry.
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