Fisker Files for Chapter 11 Bankruptcy | Edmunds

Fisker Files for Chapter 11 Bankruptcy


Just the Facts:
  • Fisker Automotive, the maker of the Fisker Karma hybrid-electric luxury car, filed for Chapter 11 bankruptcy protection on Friday.
  • Hybrid Technology Holdings, an investor group controlled by a Hong Kong billionaire, is purchasing Fisker's assets.
  • The U.S. Department of Energy said it will lose $139 million on its loan to Fisker Automotive.

ANAHEIM HILLS, CaliforniaFisker Automotive, the maker of the Fisker Karma hybrid-electric luxury car, filed for Chapter 11 bankruptcy protection on Friday.

Hybrid Technology Holdings, an investor group controlled by a Hong Kong billionaire, is purchasing Fisker's assets. Hybrid Technology purchased the U.S. Department of Energy's loan made to Fisker for $25 million, as part of a plan to reorganize Fisker. The Department of Energy put the loan up for auction in mid-October after Fisker was unable to repay suppliers, the DOE and others.

"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, in a statement. "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."

The investor group is headed by Hong Kong billionaire Richard Li, according to media reports.

The U.S. Department of Energy said it will lose $139 million on its loan to Fisker Automotive. The DOE froze payments to Fisker after handing out $192 million to the automaker.

The sale of the loan, combined with money earlier recouped puts the government's loss at $139 million.

The DOE said the 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.

The Hill blog noted that the latest twist in the Fisker saga "quickly revived GOP criticism of federal green technology loan programs."

Edmunds says: Hybrid Technology indicates that it intends to keep Fisker operating after it emerges from bankruptcy. But this is certainly not the last chapter in the Fisker story.

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