Alecta and AMF have topped up their investments in troubled Swedish battery firm Polarium, answering the privately-owned company’s call from existing investors for a recapitalisation to help it back to growth and profitability.

Polarium announced this morning that it had raised SEK500m (€44.1m) from key investors including AMF and Alecta through the issuance of convertible preference shares.

Each of the large Swedish occupational pension funds owns around 10% of the once fast-growing green battery company, having first invested two years ago, but since then Polarium suffered a slump in sales. Alecta invested SEK950m and AMF invested SEK955m in Polarium equity in 2022.

Polarium said today: “This capital injection will strengthen Polarium’s position in the rapidly expanding energy-storage sector and support its return to growth and profitability.”

Magnus Tell, Alecta’s head of equities, said: “The new capital now supplied by Alecta and other owners creates, alongside other financing, a stable situation going forward.”

Polarium’s new management had a credible business plan to make the company profitable again and create opportunities for future growth, he said.

“An important aspect is that there is now an agreement with Polarium’s largest customer to resume deliveries, which is of course positive,” Tell said.

The SEK1.3trn pensions giant – in crisis due to high-profile bad investments – said that since it invested in Polarium in 2022, the company had not developed well, having had no orders from its largest customer, and was suffering from a fall in sales and losses as a result.

“The conditions for the investment today, in combination with Polarium’s plan going forward, mean that we, as existing owners, believe in and support the company,” Tell said.

Polarium reported a SEK348m loss in EBITDA terms for 2023, down from a profit of SEK117.6m for 2022, with net sales having fallen by 48% year-on-year to SEK1.15bn.

Several large Nordic pension funds have been locked in negotiations recently with another Swedish high-profile green battery company, Northvolt, which revealed in early September it would have to cut its workforce and sell off parts of the company due to a cash shortage.

AMF has invested around SEK1.9bn in Northvolt, while the four main AP buffer funds have a SEK6bn investment in it, and Denmark’s ATP has an even higher stake.

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Rachel is IPE's Nordic correspondent. She has long been a freelance writer, and over the years, has written for The Telegraph, The Independent, The Observer, AMWatch and elsewhere. In 2001, Rachel's personal finance book Kickstart Your Money was published by John Wiley & Sons.View full Profile

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