Zhitong Finance learned that the media quoted letters to investors on Saturday saying that Swedish electric vehicle battery manufacturer Northvolt filed for bankruptcy protection in the US earlier this week, and Goldman Sachs (GS.US) will suffer losses of nearly 0.9 billion US dollars. According to the report, some of the company's private equity funds invested at least $0.896 billion in NorthVolt, making it the troubled company's second-largest shareholder.

Goldman Sachs said, “While we are disappointed with this outcome like many investors, this is a minority equity investment through a highly diversified fund. Our portfolio has concentration limits to reduce risk.”

Goldman Sachs first invested in Northvolt in 2019. Goldman Sachs held 19% of the company's shares as of when filing for bankruptcy last Thursday. According to court documents, Goldman Sachs's investment banking division is also Northvolt's creditor, which owes Goldman Sachs nearly $4.8 million.

The report also said that documents show that Volkswagen owns 21% of Northvolt's shares, is the largest shareholder of the Swedish company, and is currently facing losses similar to Goldman Sachs. According to these documents, Volkswagen is Northvolt's second-largest credit institution because it has a $0.355 billion convertible note.

Northvolt filed an application with the US Bankruptcy Court for the Southern District of Texas last Thursday and said it will continue to operate normally during the process. Northvolt chose to go through legal proceedings in the US to provide investors and third parties interested in helping with financing a known path.

The company submitted the application after months of negotiations with creditors, customers, and owners about the path ahead. After German automaker BMW cancelled a €2.2 billion ($2.22 billion) order for electric vehicle batteries in June, Northvolt has cut jobs and cut production and cancelled expansion plans. The media reported on Monday that Northvolt's transportable batteries (or batteries determined to be sufficient to be delivered to customers) have not regularly met some internal production targets since September last year.

Northvolt said on Thursday that it will receive $0.145 billion in cash collateral during bankruptcy proceedings. It said one of its clients promised $0.1 billion in new financing in the form of debtor-held (DIP) financing. The media confirmed on Thursday that Volkswagen's Scania CV AB truck manufacturing division is a DIP financing customer from Northvolt.

Northvolt said the company's planned plants in Germany and Canada will operate normally outside of bankruptcy protection proceedings. Meanwhile, Peter Carlsson stepped down as Northvolt's CEO on Friday, but he will serve as a senior advisor and continue as a board member, effective immediately. The company will be co-led by Chief Financial Officer Pia Aaltonen-Forsell and Cells' President Matthias Arleth, who will be the chief operating officer, the company said in a statement. The statement also said that the search for a new CEO has begun.