China’s largest car parts group is poised to take over Fisker Automotive. The Wanxiang Corporation has been selected as the preferred bidder for the bankrupt American firm in a deal worth around $149m.
Wanxiang emerged as the front runner as boss Lu Guanqiu faced Hong Kong telecoms chief Richard Li in 19 rounds of bidding in New York. A judge will be asked to ratify the decision on Tuesday, according to the FT.
The FT said the winning bid is worth $149m (£88.8m) with $126m (£75m) in cash and $8m (£4.7m) in assumed liabilities. Equity will also be injected into a Wanxiang affiliate company which will assume ownership of Fisker, which until 2012 built the Karma.
According to Marc Beilinson, Fisker’s chief restructuring officer, the “highly spirited” auction increased the value of the firm by more than £53m compared to the opening bid.
The auction result appears to have called an end to Richard Li’s long-running attempts to acquire the car maker. In November Li’s Hybrid Tech Holdings paid $25m (£14.9m) for US energy department rights over a $168m (£100m) loan on which Fisker had defaulted.
In a statement, Fisker said: “Hybrid has elected to retain its rights as a lender rather than continue to bid for ownership of Fisker. Hybrid is entitled to be repaid ahead of the unsecured creditors on account of its security and, in relation to any assets that are ultimately determined to be unencumbered, will share in those assets together with all other creditors.”
Pin Ni, Wanxiang’s US boss said his company’s background and experience would be beneficial to the carmaker. Wanxiang America is based in Elgin, Illinois and employs 6000 people in the US.