Polestar Automotive Holding UK PLC announced a $300 million equity injection from Banco Bilbao Vizcaya Argentaria, S.A. and Natixis, each contributing $150 million. The shares were sold as Class A ADS at $19.34 per share, with no single investor holding more than 10 % of the company’s equity. The transaction is expected to close on December 23, 2025, and the equity raise is part of a broader $600 million capital‑boost package that also includes a debt‑to‑equity conversion of approximately $300 million of the company’s outstanding principal and interest under a term facility dated November 8, 2023.
The debt conversion will be executed after regulatory approvals and will reduce Polestar’s debt load by converting the principal and accrued interest into equity. This move improves the company’s leverage profile and is expected to lower its debt‑to‑equity ratio, which has been a key concern for investors. The conversion also removes a significant interest expense from the balance sheet, freeing cash that can be deployed toward product development and market expansion.
Polestar’s liquidity position has been under pressure, with a negative free‑cash‑flow of $1.37 billion over the past twelve months and a current ratio of 0.43. Cumulative losses of roughly $8 billion and an Altman Z‑Score of –1.94 underscore the company’s financial fragility. The capital infusion is therefore critical to sustaining operations, funding the shift toward higher‑priced SUVs such as the Polestar 3 and Polestar 4, and maintaining the company’s competitive position in the electric‑vehicle market.
Management highlighted the strategic importance of the financing. CEO Michael Lohscheller said the deal “significantly enhances our liquidity position and strengthens our balance sheet, allowing us to continue investing in our product‑mix shift toward higher‑priced SUVs.” The move also signals continued confidence from Geely Holding Group, which holds a majority stake in Polestar, and other strategic partners. While the financing provides much‑needed breathing room, the company’s underlying profitability challenges and high debt levels remain a concern for long‑term investors.
The transaction requires regulatory approvals for the debt conversion, but no specific approval dates were disclosed. The company’s board has indicated that the conversion will proceed once the necessary approvals are obtained, and the equity purchase is scheduled to close by the end of December.
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