Feb. 18 (Bloomberg) -- Fisker Automotive Holdings Inc. won court approval to sell its assets to China’s Wanxiang Group Corp. for an offer valued at $149.2 million, almost six times what the hybrid-car maker sought when it filed for bankruptcy.
The outcome of last week’s auction “shows that a fair process is a good thing,” U.S. Bankruptcy Judge Kevin Gross said today at a hearing in Wilmington, Delaware.
Wanxiang topped Hybrid Tech Holdings LLC after 19 rounds of bidding with an offer that includes $126.2 million in cash, plus equity and $8 million in assumed liabilities. The purchase, which requires U.S. antitrust clearance, includes an abandoned General Motors Co. plant in Wilmington that Fisker acquired in 2010, as well as a patent portfolio.
With the assets, the Chinese buyer could revive the Fisker brand in the world’s biggest auto market, which is struggling to reduce some of the globe’s worst air pollution. It would also provide an entry point to selling cars in the U.S. Wanxiang already owns the successor to the U.S. company that supplied batteries to Fisker until collapsing under the cost of a recall.
After filing for bankruptcy in November, Anaheim, California-based Fisker asked Gross to let Hybrid buy the assets for about $25 million. Unsecured creditors objected to the price and helped bring Wanxiang, China’s largest auto-parts supplier, into the case in December.
Hybrid, led by Richard Li, the son of Hong Kong’s richest man, Li Ka-shing, held a U.S. government loan that Fisker had defaulted on without making a payment. The carmaker had drawn about $192 million of the initial commitment of $529 million from a federal program to spur production of alternative-energy vehicles. Hybrid last year paid the U.S. Energy Department $25 million to take over the loan.
Another hearing will be held to decide what portion of the sale proceeds will go to Hybrid and what portion to unsecured creditors, Sunni Beville, an attorney for the official committee of unsecured creditors, said in an interview. There isn’t enough cash to pay the Hybrid loan in full, she said.
Henrik Fisker, who founded the carmaker in 2007, told Congress in April that the battery supplier’s bankruptcy, along with safety recalls and shipments lost to Hurricane Sandy, had hurt the company’s finances.
The company hasn’t made a vehicle since 2012. Its $103,000 plug-in hybrid sports sedan, the Karma, was called a “basket case” by Consumer Reports. The magazine said its review model broke down after going less than 200 miles (322 kilometers).
Fisker had won plaudits for his work on cars for Bayerische Motoren Werke AG and Ford Motor Co.’s Aston Martin. Karma drivers included singer Justin Bieber and actor Leonardo DiCaprio.
“It was the strength and flexibility of Wanxiang America’s management team that enabled them to successfully navigate a complex and unpredictable process like this one,” Bojan Guzina of Sidley Austin LLP, an attorney for Wanxiang, said in an e-mail, referring to the Fisker sale.
The case is In re Fisker Automotive Holdings Inc., 13-bk-13087, U.S. Bankruptcy Court, District of Delaware (Wilmington).
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