Written by Cláudio Afonso | LinkedIn | X
Electric vehicle manufacturer Fisker filed late Tuesday a motion in the United States Bankruptcy Court for the District of Delaware seeking approval for a critical asset sale valued at up to $46.25 million.
The troubled automaker, which filed for Chapter 11 bankruptcy last month, aims to sell its inventory of electric vehicles (EVs) to American Lease LLC to generate much-needed liquidity.
In the motion filed on July 2, Fisker, along with its affiliates, detailed plans to sell 3,321 EVs, including its Fisker Ocean model, free and clear of all liens, claims, encumbrances, and interests.
The sale, the company argues, is vital to preserving its operations and managing a structured wind-down of its assets. The proposed transaction values each vehicle at approximately $13,917.
Here’s the document filed by the EV maker.
The company co-founded by Henrik Fisker has been grappling with significant financial difficulties and has paused production since March 2024 to realign its inventory and pursue strategic initiatives.
Despite efforts to market its assets to over 40 potential buyers, Fisker has been unable to secure a going-concern sale. The proposed sale to American Lease LLC, a vehicle leasing company serving New York City’s ride-share market, emerged as the most viable option.
The deal is contingent on the resolution of multiple stop-sale holds issued by the National Highway Traffic Safety Administration (NHTSA) due to safety defects in Fisker’s EVs.
The court documents reveal that Fisker voluntarily issued recalls related to issues with cluster telltales, power modules, and outer door handles, along with a more recent recall involving a printed circuit board assembly failure.
According to the document, American Lease has agreed to purchase the vehicles under the condition that they will not be operated until the safety issues are resolved. The agreement mandates that Fisker will coordinate and confirm the clearance of all recalls, ensuring compliance with NHTSA regulations.
Fisker’s Chief Restructuring Officer, John C. DiDonato, emphasized the importance of the expedited sale, stating that the transaction is crucial for the company’s ability to continue operating and to avoid a more chaotic liquidation process.
DiDonato highlighted that the sale will provide the necessary cash infusion to meet essential business expenses, including payroll and taxes.
The bankruptcy court has scheduled a hearing for July 9, 2024, to consider the motion, with objections to be filed by July 8, 2024. If approved, the sale could commence as early as mid-July, providing Fisker with immediate financial relief.
According to the local publication “Industrie Magazin,” the Austrian subsidiary of Fisker has encountered claims totaling 1.16 billion euros ($1.242 billion) following its insolvency.
The Graz-based unit, responsible for contract manufacturing with Magna Steyr, had only produced 10,000 of the planned 40,000 cars annually.
NEVER MISS AN UPDATE
On Friday, the company issued a recall of 8,204 Ocean SUVs in the United States due to a defect with the exterior door handles that can cause them to stick and not open, the U.S. National Highway Traffic Safety Administration (NHTSA).
Earlier this month, a group of early adopters of Fisker vehicles announced the formation of a non-profit association, aimed at ensuring continued access to parts and services for owners as the startup filed for bankruptcy protection in Delaware.
As reported on Thursday, the official “Notice of Filing of Creditor Matrix” lists some high-profile names and entities associated with the company’s operations including the founder and CEO Henrik Fisker, and also Geeta Gupta-Fisker, Fisker’s Chief Operating Officer and CFO.
The bankruptcy has triggered an automatic acceleration of its debt obligations under its 2.50% convertible senior notes due 2026, according to a recent 8-k form. There was a scheduled hearing for this later today, June 27, to discuss the cash collateral motion. However, the hearing was canceled.
Fisker is striving to provide a service network to the customers after filing for Chapter 11 bankruptcy protection last week.
According to unofficial information from a Fisker employee, the company is currently operating with a very small team in Germany and has closed its store in the center of Munich.
Written by Cláudio Afonso | LinkedIn | X
