Not a bright Spark? Goldman Sachs Loses Almost $1 Billion On EV Battery Company
Goldman Sachs has a smudge on its face when it comes to electric vehicle batteries. The storied Wall Street giant was a major investor in what was supposed to be Europe’s largest supplier of batteries to EV companies, but now Northvolt has declared Chapter 11, with Goldman as the second-largest shareholder.
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Goldman invested in Northvolt through a number of its funds and told the Financial Times that this meant the losses were not a major problem But what turned out to be at least $900 million is still a lot of money even for the world’s premier investment bank.
“While we are one of many investors disappointed by this outcome, this was a minority investment through highly diversified funds,” was the firm’s reaction to the loss. “Our portfolios have concentration limits to mitigate risks.”
Volkswagen rocked
The biggest Northvolt bankruptcy problem is for its number one investor, Volkswagen. VW was an early investor and encouraged other manufacturers and financial firms to pony up several hundred million to support what many thought was an alternative to Chinese-made batteries. Partly as a result of the Northvolt meltdown, VW is going through one of the worst periods in its history and may lay off tens of thousands of workers in its home market of Germany.
In comparison, Goldman Sachs got off easy.
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