(Quebec) In the event of a “catastrophic scenario”, Quebec will be “at the table” of creditors to recover the hundreds of millions of dollars of public funds invested in Northvolt, assured the Minister of Economy and Energy, Christine Fréchette, on Wednesday.
“Quebec would be able to recover a good part of its investment,” she declared in a debate Wednesday afternoon in the National Assembly.
Conversely, the official opposition argued that the Quebec state would come after the priority creditors and lose its stake.
The Swedish battery manufacturer is currently experiencing serious financial difficulties, which raises questions about the completion of its $7 billion factory project in Montérégie, which could be pushed back until 2030.
The value of public funds invested by Quebec is close to a billion dollars and the opposition parties have tried in vain to find out whether this portfolio is now devalued because of the company’s setbacks.
“Our financial structure is very rigorous and limits the level of risk as much as possible,” said Mr.me Fréchette in a debate Wednesday afternoon.
Quebec has already granted $240 million for the purchase of the land, which remains as collateral, in addition to $270 million invested in financing the parent company in Sweden, and $200 million from the Caisse de dépôt et placement (CDPQ). In addition, another $300 million should be paid in debentures, that is, an unsecured long-term loan, but under certain conditions.
“The choice to use a convertible debenture is prudent,” the minister argued.
“In the event of a disaster scenario where Northvolt defaults, our debenture would place us in a preferred position over shareholders to recover the company’s assets along with other creditors of equal rank. We would therefore be at the table in the event of such a situation.”