Written by Cláudio Afonso | [email protected] | LinkedIn | X
Polestar shares hit on Monday morning a new all time low of $1.24 per share as sales pressure increase and the redemption shares from Volvo’s stake start trading.
On LinkedIn, CEO Thomas Ingenlath addressed shareholders emphasizing the company’s commitment to succeed with the latest models 3 and 4. Ingenlath added also the final prototype of the Polestar 5 will be completed this year.
Earlier this year, Volvo Cars announced the plan to discontinue funding its Polestar electric sports car brand. On April 5th, the automaker announced that its shareholders agreed to distribute “a portion” of Volvo Cars’ stake in Polestar to its shareholders.
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Letter from Polestar CEO
“Many of you have heard me refer to 2024 as being both a transitional and transformational year for Polestar. This is true in more ways than one. First and utmost decisive for our business: our model offensive is becoming more and more visible, with Polestar 3 and Polestar 4 entering the markets.
Second, we have secured USD 950m in external funding. It provides us with the means to finance the next stage of our development and covers a large majority of our estimated financing needs. We have thus made significant progress on our strengthened business plan and 2025 targets: achieving cash flow break-even and a gross margin in the double-digits”.
“Third, our new shareholder structure provides a solid basis for our development. Under the new structure, Geely Sweden Holding will become the second largest shareholder and Volvo will retain an 18% stake. Today sees the next step in this process, as trading starts in the convertible shares that are being distributed by Volvo Cars. This strengthens and clarifies our ownership structure within the Geely ecosystem, as well as providing us with a wider shareholder base and increased free float, something we have aimed for since our NASDAQ listing in 2022.
To those shareholders that have received their convertible shares: welcome to Polestar! In the absence of being able to offer you all the pleasure of test-driving our outstanding and growing model line-up, I would like to take this opportunity to reflect on why I am so excited about our future.
It’s all about our line-up of electric performance cars – developed and produced for the modern, demanding and performance-oriented drivers. Many of you will have seen, tested or driven Polestar 2. It’s a wonderful car, in so many ways, that reflects our heritage, demand for quality and Scandinavian design ethos.
Polestar 3 is now in production. The first cars will be arriving in Europe in the coming weeks and once final software is installed, the first deliveries are planned for this quarter. This SUV for the electric age combines performance and luxury in a way that you have most likely never experienced before.
Polestar 4 – our SUV coupé – has been making headlines all over the world in the last few weeks: for its unique design, for its luxurious interior and exceptional performance and handling. Sales have started around the world. The first deliveries in Europe are planned for the end of the summer.
As these luxury, electric SUVs represent the next step for our growing line-up, it really is Polestar’s moment to shine. Especially when you consider that final prototype development of Polestar 5 – our 4-seat grand-tourer – will be completed during this year, as well.
To our existing and new shareholders: I speak on behalf of everyone at Polestar when I say that we are fully focused on delivering the most exciting, exclusive performance cars on the market. Together, we will make 2024 a hugely transformational year.
Regards,
Thomas”
Volvo’s Board of Directors has decided to distribute 62.7 percent of Volvo Cars’ stake in Polestar, and, based on Polestar’s closing price of $1.53 per share, value transfer to Volvo Cars’ shareholders amounts to approximately SEK 10.4 billion, 976,470,976 usd.
“The record date for the share split is April 12, 2024, and the redemption shares will be traded from April 15 to April 30, 2024. Shareholders will get the redemption consideration, SDRs representing Polestar Class A ADSs, around May 13, 2024. They can convert SDRs into Polestar Class A ADSs from May 13 to August 13, 2024,” Volvo stated.
Polestar has been facing several challenges including delays in key model releases (Polestar 3 and 4) and a decline in its stock value by over 70% from last year.
Last week, the German Federal Motor Transport Authority (KBA) released the car registration data for March, revealing that the Swedish automaker Polestar registered 357 vehicles in the country.
Polestar achieved its highest sales figures since September 2023 and a total of 641 in the first quarter of the year. Despite this improvement, March’s figures still fall short of the manufacturer’s peak performance seen in June and July of last year, when it registered 950 and 1,052 vehicles, respectively.
Written by Cláudio Afonso | [email protected] | LinkedIn | X
