2012 Fisker Karma EcoSportEnlarge Photo
Bankrupt automaker Fisker Automotive is urging courts to approve the sale of its assets to a Hong Kong company currently bidding on it, in the hope that it can prevent Chinese auto parts maker Wanxiang from intervening and buying up the assets before the sale can take place.
According to Reuters, Fisker alleges that Wanxiang, previously seen as one of the companies likely to walk away with Fisker's assets, was largely responsible for its failure and eventual bankruptcy last year.
Following the bankruptcy of Fisker battery supplier A123 Systems, the battery company's new buyer Wanxiang allegedly cut battery supplies to the ailing electric car startup. This prevented Fisker from restarting production of its Karma extended-range electric car, problems that snowballed over the following 18 months and eventually led to the firm's collapse.
In a filing against Wanxiang's proposal, Fisker said that the Chinese firm "seeks to profit from the bankruptcy it helped cause", with its $24.725 million bid. An attorney for the creditors' committee disputes that suggestion, noting that Fisker had already idled production to save cash several months before Wanxiang acquired A123.
Until now, it was understood that Hybrid Technology Holdings LLC, a company affiliated with Hong Kong business tycoon Richard Li, had bought Fisker's assets with a $25 million "credit bid", partially paying off Fisker's outstanding Department of Energy loans. However, this bid has not yet been approved, as several unsecured creditors have voted to reject the plan. Fisker is now asking the courts to approve the sale to Li and prevent Wanxiang's bid. A final decision on who gets Fisker is expected next week.
Meanwhile, several of Fisker's founders are being sued by investor group Atlas Capital Management LP for issuing "materially false and misleading statements" that led to Atlas erroneously investing in Fisker before its financial issues became apparent.