Varta, the battery production firm, is trimming its projections.
Struggling battery company Varta, known for its issues, has lowered its revenue projection thanks to problems in its energy storage division. The new expected revenue range is between 750 to 800 million euros, which is 70 million euros less than previously estimated. Following the implementation of the Starug procedure, Varta's public image and credibility have suffered, negatively impacting the sale of energy storage systems, the company explained. This downturn is also linked to reduced sales of substantial lithium-ion cells.
Recently, Varta sealed a deal with creditors, bond holders, and potential stakeholders regarding a salvage plan, finalizing the necessary contracts. Nevertheless, there had been ongoing disagreements regarding specific details during the negotiations, which commenced in July.
Austrian investor Michael Tojner and Porsche are contributing a combined 60 million euros through equity investments. The remaining shareholders will receive no financial compensation. Overextending itself with unsuccessful investments, Varta found itself in a critical state. According to the restructuring strategy, creditors have agreed to forgive more than half of their loan and bond debts.
Despite the restructuring strategy, the disagreements during negotiations with creditors have severely affected the sale of Other Varta products, such as unrelated energy solutions. The reduced revenue is not only due to the energy storage division issues but also the impact on Other product sales.
