News

# Hong Kong’s Hybrid Tech acquires Fisker and DoE loses over $130 million November 24, 2013 by Jeff Shepard Fisker Automotive, Inc. and Fisker Automotive Holdings, Inc. (collectively, Fisker Automotive) announced today that they have entered into an asset purchase agreement with Hybrid Tech Holdings, LLC (Hybrid) for the sale of substantially all of its assets. Hybrid is the lender under an approximately$170 million loan secured by first liens on substantially all of Fisker Automotive's assets. Hybrid's parent, Hybrid Technology, LLC (Hybrid Technology), purchased the loan from the U.S. Department of Energy (DoE). Hybrid is owned by Hong Kong billionaire Richard Li.

To facilitate the sale process and provide for orderly distributions to creditors, Fisker Automotive has voluntarily filed petitions under Chapter 11 of the U.S. Bankruptcy Code. Hybrid Technology has committed up to approximately $8 million in debtor-in-possession (DIP) financing to fund the sale and Chapter 11 process. "After having evaluated and pursued all other alternatives, we believe the sale to Hybrid and the related Chapter 11 process is the best alternative for maximizing Fisker Automotive's value for the benefit of all stakeholders," said Marc Beilinson, Fisker Automotive's Chief Restructuring Officer. "We believe that the Fisker Automotive technology and product development capability will remain a guiding force in the evolution of the automotive industry under Hybrid's leadership." In a separate announcement, the Obama administration said Friday it will lose$139 million on a loan to struggling electric car maker Fisker Automotive Inc. after selling part of the loan to a private investor that immediately took the company into bankruptcy. The Energy Department awarded Fisker a $500 million loan guarantee in 2009, but suspended it in 2011, after Fisker failed to meet a series of benchmarks. Fisker had received$192 million before the loan was frozen. The Energy Department said it had recovered about $28 million before selling the remainder of the loan to Hybrid on Friday for$25 million.

The department's actions, along with the sale, mean the Energy Department has protected nearly three-quarters of its original commitment to Fisker, Energy spokesman Bill Gibbons said Friday. "While this result is not what anyone hoped, the ($139 million loss) represents less than 2 percent of our advanced vehicle loans, and less than one-half of 1 percent of our overall loan program portfolio" of more than$30 billion, Gibbons said.

A spokeswoman for Hybrid Technology said Fisker's new owners are committed to ensuring that the car company, which makes the \$100,000 Karma plug-in sedan, continues to design and manufacture electric cars. "We will work to realize the full potential these fantastic cars offer in helping to remake the auto industry for the 21st century," Caroline Langdale, a spokeswoman for Hybrid, said in a statement.

Langdale declined to say where the company will make its cars, but the Energy Department said Hybrid has committed to moving manufacturing of the Karma from Finland to the U.S., with engineering and design remaining in California.

0 Comments