ATP’s large stake in stricken Swedish battery company Northvolt is now almost worthless, the chief executive officer of the Danish statutory pension fund has admitted in a television interview – but he declined to rule out putting more money into the firm.
Martin Præstegaard said in an interview today with Danish national broadcaster DR: “The value of the company is today not very far from zero. This means that most of the investment is gone.”
Last month, Northvolt – whose investors include several Nordic pension funds – was forced to file for Chapter 11 bankruptcy protection in the US, following months of talks to recapitalise the firm.
ATP has invested around DKK2.3bn (€308m) in Northvolt and owns about 5.3% of the shares.
ATP declined to tell IPE last month whether it had written down its investment in Northvolt.
Præstegaard told DR in today’s interview: “We never disclose what our companies are worth. We don’t do that because we sell them continuously.”
He told the broadcaster it was not sensible to tell negotiating partners what one thought the companies it owned were worth from the start.
“That wouldn’t be in the Danes’ interest,” the CEO said.
Explaining why he was making an exception in this case, Præstegaard told DR: “You can see and read about Northvolt in the public eye. And it probably doesn’t take much imagination to imagine that we don’t consider it to be worth much today.”
Asked what had gone wrong with Northvolt, the ATP CEO told DR that it had been difficult for the Swedish company to get production working.
“It has been difficult to build a large company with many thousands of employees quickly. And they have probably overdone it with both a large factory in Sweden, but also plans for factories in Germany and Canada,” he said.
Præstegaard said ATP had learned lessons from the failed Northvolt venture, including that one had to be extra careful about throwing large sums of money at new companies that require very heavy investments to get started.
He said ATP was now following the process to see what happened with Northvolt.
“The aim is to have a viable company. We will have to see if that is possible,” he said.
Asked whether ATP was ready to put more money into Northvolt, he said this had not yet been decided.
“It depends entirely on whether we can create a case where we believe, with overwhelming probability, that there is a good correlation between the return we can get and the risk we run,” Præstegaard said.
Read the digital edition of IPE’s latest magazine
No comments yet