Polestar announced a $400 million equity investment from two major financial institutions, marking the Swedish electric performance brand’s second significant capital raise in less than two months. The deal follows a similar $300 million equity financing and $300 million debt-to-equity conversion completed in December 2025, as the automaker continues an aggressive push to stabilize its financial position.
Highlights
- Sumitomo Mitsui Banking Corporation and Standard Chartered Bank each committed $200 million to the equity investment, structured through a special purpose vehicle called Feathertop Funding Limited.
- Class A ADS shares are priced at $19.34, matching the per-share price from the December equity financing round.
- Neither institution will hold more than 10% of Polestar’s outstanding equity following the transaction, which is expected to close by February 5, 2026.
- Geely Sweden Holdings AB provides a three-year put option to both financial institutions, offering a defined exit path with certain returns.
Deal Structure and Terms
The investment arrives through Feathertop Funding Limited, a special purpose vehicle consolidated to Sumitomo Mitsui Banking Corporation. Both Sumitomo Mitsui and Standard Chartered Bank (Hong Kong) Limited contributed equally at $200 million each. Concurrently, the two institutions entered into put option arrangements with a wholly-owned subsidiary of Geely Sweden Holdings AB, granting them an exit mechanism within three years that includes guaranteed returns.
The financial institutions face no restrictions on selling the Class A ADSs they receive, aside from standard applicable securities law requirements. No regulatory approvals are needed for the transaction to proceed. BofA Securities served as Polestar’s exclusive financial advisor.
Broader Financial Context
This $400 million round represents the latest in a series of capital-raising moves by Polestar since mid-December 2025:
- December 16, 2025: Polestar secured a new term loan facility of up to $600 million.
- December 19, 2025: The company announced a $300 million equity investment from Banco Bilbao Vizcaya Argentaria and NATIXIS ($150 million each), plus a $300 million debt-to-equity conversion by Geely Sweden Holdings AB.
- January 9, 2026: Polestar reported record retail sales for 2025.
Polestar CEO Michael Lohscheller stated the new equity financing, combined with December’s funding activity and continued support from Geely Holding, demonstrates ongoing progress in strengthening the company’s liquidity position and balance sheet. He pointed to a record year of retail sales as the foundation for building a stronger company going forward.
Company Profile
Polestar is headquartered in Gothenburg, Sweden, and sells vehicles across 28 markets in North America, Europe, and Asia Pacific. The current lineup includes the Polestar 2, Polestar 3, Polestar 4, and Polestar 5. Planned future models include the Polestar 7 compact SUV (expected in 2028) and the Polestar 6 roadster. Manufacturing currently spans North America and Asia, with European production of the Polestar 7 in development.
The company has set sustainability targets to cut greenhouse gas emissions per vehicle sold by 50% by 2030 and achieve climate neutrality across its value chain by 2040.
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