Valmet Automotive is reshaping its strategy. In the future, the company will offer its expertise also beyond the automotive industry, for example, to the defense sector. In the changed geopolitical situation, Valmet Automotive’s special expertise in industrial serial production will strongly benefit the whole of Finland. As part of an ownership and financing arrangement enabling Valmet Automotive’s strategic expansion, IONCOR, the company’s subsidiary focused on battery systems, will become a subsidiary of Finnish Minerals Group, a fully state-owned company developing the battery value chain. The Finnish State will become Valmet Automotive’s majority owner, and Pontos Group will continue as a minority owner.
In 2024, Valmet Automotive initiated a strategic review for increasing the independence of its business areas and expanding the contract manufacturing business to new industries. The downturn in the European automotive industry has been prolonged and the electrification of transport has progressed more slowly than expected. The ownership and financing arrangements now carried out will enable Valmet Automotive’s strategic expansion: in the future, the company will offer its decades-long, in-depth expertise in industrial serial production to a variety of industries, including contract manufacturing of defense supplies.
“We are taking a completely new step in Valmet Automotive’s sixty-year history, as we are expanding the company’s business beyond car manufacturing. Our expertise in industrial serial production, unique in Finnish conditions, creates a strong foundation for this expansion. This will add new pillars to our business and, on the other hand, create more domestic production capacity in Finland, for example, for the needs of the defense sector and security of supply. I am particularly pleased that the special expertise in industrial serial production will now remain in Finland,” says Pasi Rannus, CEO of Valmet Automotive.
The divestment of IONCOR and the investment made by the State are important steps in Valmet Automotive’s strategic change. “IONCOR is one of Europe’s leading independent manufacturers of automotive battery systems, and thus a key player in the clean energy transition. Now, the company becomes an integral part of the Finnish battery value chain and, with new owners, gains even stronger support for developing its operations,” Rannus continues.
IONCOR designs and manufactures battery solutions for the electrification of transport, buses and trucks, and off-highway machinery. IONCOR was established when Valmet Automotive decided to make its three business areas more independent: the battery systems business (now IONCOR), RKS (Roof & Kinematic Systems) which focuses on roof and kinematic systems and operates in Poland and Germany, and the parent company’s contract manufacturing business.
“We are very pleased with the ownership and financing arrangement that has now been established. Valmet Automotive’s strategic expansion is now made possible, and with its new owners, IONCOR will have an excellent opportunity to develop its business as part of the Finnish battery value chain,” says Kari Heinistö, Chairman of Valmet Automotive’s Board of Directors.
The Finnish State will become Valmet Automotive’s majority owner
As part of a wider ownership and financing arrangement, the Finnish State becomes the majority owner of Valmet Automotive Plc. The State and Pontos Group have acquired a 20.6% shareholding in Valmet Automotive from the Chinese Contemporary Amperex Technology Limited. Following the financing arrangement, the State will own 79% and Pontos Group 21% of Valmet Automotive. Valmet Automotive’s ownership is transferred from Finnish Industry Investment Ltd (Tesi) to direct state ownership. In addition, the State and Pontos Group will invest approximately EUR 37.5 million of new capital into Valmet Automotive.
At the same time, the State, Varma Mutual Pension Insurance Company, and Pontos Group together acquire Valmet Automotive’s shares in IONCOR, the company’s subsidiary focused on battery systems. IONCOR Ltd will become a subsidiary of Finnish Minerals Group, a fully state-owned company developing the battery value chain. The parties have agreed that the acquisition price will not be disclosed. Following the financing arrangement, IONCOR will be owned by Finnish Minerals Group (70% shareholding), Varma (16%), and Pontos (14%). In addition, the State will invest approximately EUR 20 million of new capital into IONCOR.
The ownership and financing arrangements will not affect the operations of Valmet Automotive’s subsidiary RKS. Valmet Automotive’s CEO Pasi Rannus will continue in his position.
Aventum Partners and Hannes Snellman Attorneys Ltd have acted as the advisors in the ownership and financing arrangement.
