The planned sale of Fisker to Hong Kong's Hybrid Technology for a sum of $25 million has been rejected by a U.S. bankruptcy judge due to interest from Chinese firm Wanxiang, something Fisker’s management team was hoping to avoid. Judge Kevin Gross instead allowed for rival parties to bid on Fisker in an attempt to help raise the price on behalf of the electric car company’s creditors.
"I think that, for me, at the end of the case, whether or not the price paid was fair or reasonable, I think an auction will provide that mechanism,” Gross is reported by Reuters as having stated in a court on Friday. “That is the most favored method."
Wanxiang, which has teamed up with some of Fisker’s creditors, is expected to start the bidding at $35 million. In a court filing, Wanxiang said it hoped to move production of Fisker’s Karma from the Valmet plant in Finland to a location in the U.S. It also said it would like to continue Fisker’s original plan to build a second model, the Atlantic, at a plant in Delaware.
Fisker’s management team has previously alleged that Wanxiang was largely responsible for the original bankruptcy through its buyout of Fisker’s bankrupt battery supplier A123 Systems, so is reluctant to see the company sold to Wanxiang now. They allege that Wanxiang cut battery supplies to Fisker after buying 123 Systems, causing Fisker to cease production of its Karma and eventually run out of cash.
Despite the setback, Hybrid Technology plans to bid in the auction for Fisker, which is likely to take place in February.