Porsche intends to acquire a significant stake in Varta's battery division
In a series of significant moves, German automotive giant Porsche and battery manufacturer Varta have announced plans to deepen their collaboration in the battery sector.
Varta, currently undergoing a financial restructuring, has secured a much-needed boost with a 100 million euro capital increase, facilitated by Porsche. This injection of funds comes as Varta grapples with a "debt haircut" due to investments in promising business models not meeting expectations.
As part of the restructuring, Varta aims to reduce its debt from 485 million euros to a more manageable 200 million euros. To this end, the company has also secured a senior secured loan to improve its liquidity.
Meanwhile, Porsche is poised to become the majority owner of V4Drive, a battery manufacturer that produces large-format lithium-ion round cells. The approval for Porsche's majority stake acquisition in V4Drive has been granted by antitrust authorities in Germany, the European Union, and the United States. Porsche plans to invest 30 million euros in Varta to aid in its financial reorganization.
The Porsche majority takeover of V4Drive is contingent upon antitrust approvals in various countries and the successful implementation of Varta's financial restructuring. Lutz Meschke, finance and IT executive board member at Porsche, expressed that the majority takeover of V4Drive aims to drive the company forward and keep key technologies in Germany.
Porsche's advancement of V4Drive's production facility for booster cells in Noordlingen, Germany, is expected to begin production in 2025. These batteries are used in the hybrid Porsche 911 Carrera GTS.
Dr. Michael Tojner, chairman of Varta's supervisory board and majority shareholder, stated that Varta offers potential to reduce Europe's dependence on Asian battery cell suppliers. He emphasised the importance of a "stable financial basis" for Varta to remain the minority stakeholder in V4Drive.
No specific timeline was provided for the anticipated closing of the deal. However, with these strategic moves, both Porsche and Varta are positioning themselves for a stronger future in the burgeoning battery technology sector.
