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News and Information about bankruptcy
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British startup Zenos, which entered bankruptcy administration earlier this year is now back in business. The Norfolk-based sports car manufacturer was bought by a consortium of investors headed by AC Cars, another British brand. The consortium has acquired all of its assets including Zenos’ intellectual property, ten remaining cars assembled, as well as its Wymondham headquarters.
Zenos Cars was founded in 2012 by Ansar Ali and Mark Edwards ---both were formerly connected to two famous British automotive companies--Lotus and Caterham. The British automaker started out at Hethel Engineering Center with a small lineup of lightweight carbon-fiber sports cars including the Zenos E10. Using Ford EcoBoost for its engine, the Zenos E10 sports car is also made with an aluminum and composite chassis. Eventually, the company started experiencing financial setbacks due to high production cost.
AC Cars Limited meanwhile continues to manufacture the Cobra also known as the MkVI roadster or Shelby Cobra. Only recently, the British brand increased its lineup by building a right hand drive version of the iconic sports car.Read the entire article AC Cars saves Zenos brand from extinction
Remember Zenos Cars, a British carmaker that specializes in designing and building lightweight and high-performance sports cars? If you are wondering how the company is faring with their E10 lightweight car, Zenos hasn’t been doing well and is, in fact, in dire financial straits. The severity of its financial problems has the company compelled to enter into administration, a process that is similar to bankruptcy protection.
According to a notice on the carmaker’s Web site, the company was placed under administration on January 16, 2017, with Irvin Milton Cohen and Gary Paul Shankland -- both of Begbies Traynor (London) LLP -- being appointed as Joint Administrators. Cohen and Shankland are now acting as Zenos agents without any personal liability. As Joint Administrators, Cohen and Shankland are now in charge of the management of the carmaker’s affairs, business and property.
Zenos’ humble beginnings can be traced to May 2012, when it was founded by Ansar Ali and Mark Edwards. Edwards and Ali were both employees at Lotus, and then at Caterham. However, Ali left Zenos in 2015 and joined the ranks at McLaren – although he remained a shareholder. According to his LinkedIn account, Ali is now the managing director for McLaren Special Operations (MSO) at McLaren Automotive. Edwards is currently Zenos’ chief executive, although his management powers are now gone.Read the entire article British sports car startup Zenos Cars goes financially bust
A Dutch appeals court has declared the bankruptcy of financially troubled Dutch supercar maker Spyker "null and void with retrospective effect." A local court placed the company in bankruptcy on Dec. 18 by a Dutch court after the bridging funds promised during creditor protection failed to materialize. Spyker only received the funds 11 days later and then filed an appeal on bankruptcy ruling.
The nullification of the bankruptcy declaration means that Spyker is now back under the protection of the "moratorium of payment," which is similar to the Chapter 11 protection in the United States.
With the matter resolved, Spyker chief executive Victor Muller said he plans to push ahead with development of the B6 Venator entry-level luxury sports car as well as merge with a US-based maker of high performance electric aircraft.Read the entire article Dutch appeals court cancels bankruptcy of Spyker NV
A Dutch district court has declared Spyker NV bankrupt, placing the financially troubled supercar maker under court-supervised receivership. Also placed under receivership are Spyker’s wholly owned subsidiaries Spyker Automobielen and Spyker Events & Branding. The court-appointed administrator for Spyker is now tasked to guide the carmaker through bankruptcy proceedings, the Dutch company said in a statement.
The carmaker said that the court ruled to declare it bankruptcy after a planned bridge funding failed to reach it on time. Spyker founder and chief executive Victor Muller has vowed to revive the company and this time around, he said that his company’s bankruptcy “is not the end.”
He remarked that he will “relentlessly endeavor” to revive Spyker as soon as practically possible. He said that once Spyker is revived, it would merge with a high performance electric aircraft maker and develop electric vehicles with “disruptive sustainable technology.”Read the entire article Dutch court sends Spyker NV into bankruptcy
Back in August 2013, Wiesmann filed for insolvency at the Muenster court in Germany but by the end of the year the company announced that it found an investor, so everything looked good for the well-known carmaker. Today, we found out that Wiesmann closed its doors and that all its 125 employees were sent home, according to Dutch magazine Autovisie.
According to one of the employees, there were several investor calls but the money still didn’t come. As a result, Wiesmann closed its factory and the maintenance shop, which means that owners will have to take their cars to a BMW dealer as all of them are using BMW technology.
For those who don’t know, Wiesmann was founded in 1988, but in 2009 the first problems appeared as the company wanted to expand its factory in Dulmen and spent several million euros.Read the entire article Wiesmann closes its doors as it failed to found an investor
General Motors could potentially reduce its product liability relating to a recall of around 1.6 million vehicles caused by a faulty ignition if the carmaker would invoke the terms of its bankruptcy restructuring. The terms of GM’s restructuring tell that the carmaker’s product liability extends only to accidents that happened after the reorganized company – the new GM – emerged from bankruptcy in July 2009.
Plaintiffs injured before July 2009 would have to seek redress from the defunct shell of GM – the old GM -- in Bankruptcy Court, where the chances of gaining compensation is slim.
GM's original restructuring plan would have rendered the carmaker immune to liability claims from all of its pre-bankruptcy cars, including the oldest models covered by the ignition switch recall, like the Chevrolet Cobalt, Pontiac G5 and Saturn Ion. But due to intense discussions with state attorneys general and consumer groups such as the Center for Auto Safety, GM changed the terms.Read the entire article GM execs could invoke bankruptcy terms to reduce recall liability
Lawyers for Fisker Automotive Holdings Inc. have managed to convinced United States Bankruptcy Judge Kevin Gross in Wilmington that the carmaker’s Chapter 11 should proceed at an unusually rapid pace. Gross began a Tuesday hearing by suggesting that Fisker should slow down its plan to sell its assets to Hong Kong tycoon Richard Li and give creditors four more weeks to get hold of the situation, saying that it should “allow time for the creditors' committee to continue and complete its investigations."
Fisker filed for bankruptcy on Nov. 22, 2013, while a creditors' committee was established on Thursday. The carmaker has not built a car in almost 18 months and Gross said that there was no business that has to be rescued via bankruptcy. "This is not the case of a melting iceberg or a burning omelet or anything of that nature," he said.
Attorneys for both Fisker and its creditors beg to disagree. In fact, no one took up the judge's suggestion to slow the process. said Sunni Beville, a lawyer at Brown Rudnick who represents the committee of unsecured creditors, remarked that the creditors' committee agreed that Fisker’s timeline is the “right timeline."Read the entire article Judge okays quick Chapter 11 proceedings for Fisker
Fisker Automotive has filed for Chapter 11 bankruptcy protection as part of its restructuring plan. Investor group Hybrid Tech Holdings LLC is acquiring Fisker's assets and is providing $8 million in debtor-in-possession financing to fund the carmaker's sales and restructuring. The United States Department of Energy sold its green-technology loan in Fisker to Hybrid Tech for $25 million.
Hybrid Tech bought one loan granted by the Department of Energy that has an initial worth of $168 million. The sale allowed DOE to recoup around $53 million on its $192 million investment in Fisker. Marc Beilinson, Fisker's chief restructuring officer, said in a statement that after evaluating and pursuing all other alternatives, the sale to Hybrid and the related Chapter 11 filing is the best alternative for maximizing the carmaker's value for "the benefit of all stakeholders."
He said that under Hybrid's leadership, Fisker's technology and product development capability "will remain a guiding force in the evolution of the automotive industry." Hybrid Technology said in a statement that the purchase of the government loan was the first step toward resuming production and sale of the Fisker and the development of other hybrid-electric vehicles.Read the entire article Fisker files for Chapter 11 bankruptcy protection
German retro-style sports carmaker Wiesmann filed for insolvency at the Muenster court in Germany on Aug. 14, 2013 and is looking for strategic partners and investors. Wiesmann said in a statement that operations its headquarters in Duelmen, Germany, will still continue. Wiesmann said that Rolf Haferkamp will still sit as its chief executive, leading efforts to restructure the financially troubled carmaker.
Wiesmann was established quarter of a century ago by brothers Martin and Friedhelm Wiesmann, who developed the first prototype in the cellar of their home. Wiesmann has a workforce of 110 people and has sold over 1,600 of its hand-crafted sports vehicles in Europe, the Middle East and Asia.
Stefan Bratzel, director of the Center of Automotive Management at the University of Applied Sciences in Bergisch Gladbach, Germany, told Bloomberg that it is difficult for niche companies to keep up with innovation and economies of scale in the auto industry.Read the entire article Wiesmann filed for insolvency in Muenster, Germany
The city of Detroit has filed for bankruptcy, becoming the most populous city in the United States to do so. The city is now seeking court protection from creditors as it tries to get rid a budget deficit and reduce its long-term debt. Michigan Governor Rick Snyder has authorized the city's emergency manager, Kevyn Orr, to file the petition. He said in a letter that the bankruptcy petition is “a last resort to return” Detroit to “financial and civic health for its residents and taxpayers."
Census data show that the median household income in Detroit was less than $28,000, compared with $49,000 across Michigan, with over 36 percent of residents lived in poverty as of 2011. The median home value of $71,000 in the city was barely half the $137,000 value across Michigan.
The city listed assets and debt of over $1 billion in a Chapter 9 petition filed in court in Detroit. Chapter 9 of the U.S. Bankruptcy Code is reserved for municipalities, with rules distinct from that of Chapter 11.Read the entire article Detroit succumbs to bankruptcy, seeks court protection
Lio Energy Systems Holdings and Miles Electric Vehicles, affiliates of collapsed American electric car maker Coda Automotive, filed for Chapter 11 bankruptcy protection Tuesday. The green companies are seeking to have their cases jointly administered with those of parent Coda Holdings and its affiliates. One of the main reasons for the companies’ demise is the slow embrace of consumers in the United States on electric vehicles, mainly due to their high prices, insufficient charging infrastructure and worries with driving range.
These hurdles have made the green car market a more difficult place to succeed. Coda, which filed for bankruptcy on May 1, 2013, and its affiliates were not the only ones suffering this debacle. Another green carmaker Fisker Automotive Inc. might take a similar path after it was disclosed to be seeking a buyer after hiring bankruptcy advisers.
Large carmakers who have invested heavily in green cars like General Motors, Ford, Nissan and Honda are also feeling the heat of slow sales of electric vehicles. Lio Energy Systems is described in court filings as a direct subsidiary of Coda Holdings, while Miles Electric Vehicles is a direct subsidiary of Lio Energy.Read the entire article Two Coda affiliates filed for Chapter 11 bankruptcy protection
The United States Bankruptcy Court for the District of Delaware has approved a plan by electric carmaker Coda Automotive to sell its assets for $25 million to a group of lenders led by Fortress Investment Group. The transaction entails payments of $1.7 million in cash, while the rest will be paid through a "credit bid," in which Fortress will bid for Coda’s assets using debt owed instead of cash.
In its bankruptcy petition filed on May 1, 2013, Coda said it is exiting the car business to concentrate on the development and sale of energy storage systems through subsidiary Coda Energy. In a statement, Coda said the court’s approval of the sale will allow it to emerge in a stronger position to develop its core technology, forge stronger relationships with partners, and allow it to execute its business plan in the “growing energy-storage sector."
Two Coda affiliates -- Lio Energy Systems Holdings and Miles Electric Vehicles – recently filed for chapter 11 bankruptcy protection and are seeking to have their cases jointly administered with those of Coda Holdings and its affiliates, including Coda Automotive.Read the entire article US bankruptcy court approves asset sale plan of Coda Automotive
Sources say that Fisker is preparing to file Chapter 11 and that this may take place within the next few days. It’s believed that Fisker’s lawyers have readied the bankruptcy documents and that options will be discussed on Tuesday at a meeting to be attended by Fisker's board of directors.
The source said that the directors, who have not given up on a potential sale, are likely to choose the best time for a possible Chapter 11 bankruptcy filing at that time. In the past several months, the relationship between the DOE and Fisker has been tense.
The top Fisker executives have been ineffectively trying to draw in buyers, primarily in China and Europe, to hinder bankruptcy. The source said that the government hopes to put a distance between it and Fisker's financial struggles so that the next DOE secretary won’t have to handle the problem.Read the entire article Fisker preparing to file Chapter 11 within the next few days
There may soon be a ruling from a U.S. bankruptcy judge on whether the 2009 government-led restructuring of General Motors Co. had improperly favored hedge funds. GM may lose almost $1 billion if it gets an adverse decision. Judge Robert Gerber has to decide if a "lock-up agreement" in the restructuring released $367 million to a certain hedge fund noteholders at the expense of other creditors.
A lawsuit was filed by a trust that represents unsecured creditors to undo the lock-up agreement, asserting that it was a last-minute agreement hidden into GM's bankruptcy to guarantee the support of the hedge funds. Soon after "Old GM" filed for bankruptcy in 2009, its premium assets were sold to the new General Motors Co. What was left of the company was liquidated to benefit the creditors.
The hedge funds, which hold notes with about $1 billion in face value, got the $367 million under the lock-up agreement; however, unsecured creditors got only pennies on the dollar. In addition, the hedge funds and other investors in the notes received a claim against "Old GM" that cost $2.67 billion. Under this lawsuit pending before the U.S. Bankruptcy Court in Manhattan, the creditors' trust claimed that the lock-up agreement was not fair to "Old GM" creditors.Read the entire article GM may lose almost $1 billion from bankruptcy-related lawsuit
Due to the sudden rise in demand after the bankruptcy-related announcement of American Suzuki Motor Corp. to discontinue automobile sales in the U.S., it will have to import about 2,500 more vehicles. Still, we have to mention that the company will continue to sell motorcycles, ATVs and marine motors. The U.S. distributor of Suzuki cars told dealerships to make the most of their “one last chance.”
Last Thursday, Freddie Reiss, the company’s chief restructuring officer, confirmed that no more cars are being produced for the U.S. market. It was revealed earlier this month that the November sales of American Suzuki increased by 22% to 2,224 units.
According to dealers, sales grew in December, mostly due to huge incentives and a seven-year warranty program. But Reiss said that even with the surge in sales, the automaker still won’t be able to justify staying in the U.S.Read the entire article Suzuki to import 2,500 vehicles in U.S. as demand rises after bankruptcy
The popular Nurburgring racing track in Germany could still host the German Grand Prix in July 2013 despite the uncertainty related to the track's insolvency. Thomas Schmidt, managing director of track owner Nurburgring GmbH, told Reuters that if the issue on whether there will be a Formula One race at Nuerburgring in 2013 is resolved by the end of 2012, “that would still be early enough.”
The current operator NAG, which has leased the facilities from Nuerburgring GmbH, is holding talks with F1 chief executive Bernie Ecclestone to secure the race and keep him from awarding the German Grand Prix to Hockenheim, which alternates each year with its rival. Nuerburgring GmbH, 90-percent of which is owned by the German state of Rhineland-Palatinate, collapsed into insolvency amid a leasing fee dispute with operator NAG.
The German state of Rhineland-Palatinate has sought to restructure Nurburgring GmbH through the aid of a bridge financing package, but European Union’s competition regulators in August intensified their probe into state aid. Rhineland-Palatinate is under pressure to force Nurburgring GmbH to pay after pouring millions of euros into a racing-themed amusement park there.Read the entire article Nurburgring could still host 2013 German Grand Prix despite insolvency
Fisker Automotive Inc. has asked a bankruptcy judge to postpone the auction of A123 Systems Inc., a U.S.-based electric-car battery maker. Gregg Galardi, the attorney of the luxury hybrid automaker, has filed court papers in Wilmington, Del., to state that if the sales process is rushed, it will hurt the estates and deny creditors of value that may be encountered through higher and superior offers.
He also said that Fisker will file an “emergency motion” to challenge the so-called debtor-in-possession loan. He declined to reveal details. Court papers indicate that Fisker is asking to extend the bid deadline, auction date and related dates and deadlines in the bidding procedures request by a minimum of 30 days.
A123, which was given a $249 million federal grant, said it will sell its automotive-business assets to Johnson Controls Inc. in a $125 million deal. The deal is subject to other potential offers in a bankruptcy auction. In Chapter 11 documents, A123 (which is based in Waltham, Mass.) posted assets of $459.8 million and debt of $376 million as of Aug. 31. According to court documents, A123 is scheduled to go back to court next week to get approval of what remains of a $72.5 million loan.Read the entire article Fisker asks bankruptcy judge to postpone the auction of A123 Systems
A123 Systems Inc. may not have sufficient cash to finance operations and may need to file for bankruptcy protection, the lithium ion battery maker disclosed in a filing with the US Securities and Exchange Commission. A123 Systems expects to be in default on certain material debt agreements on Oct. 16, 2012. According to the filing, A123 Systems does not expect to be on time with the interest payment due Oct. 15, 2012 on $143.75 million of notes expiring 2016.
The company also does not expect to be on time with a $2.76 million payment due Oct. 15, 2012, in outstanding 6 percent notes. The company gave no assurance that it could avoid restructuring, reorganization, or a bankruptcy filing. A123 Systems was severely hit by liquidity problems and currently needs fresh funds after it was clobbered by the cost of the recall of batteries for Fisker Automotive Inc.
The lithium ion battery maker disclosed in August 2012 that it was holding discussions with Wanxiang Group Corp., over a possible financing in exchange for a majority stake in A123 Systems. The company said that Wanxiang has plans to invest up to $465 million in A123, in return for an 80-percent stake in the company.Read the entire article A123 Systems warns of severe liquidity problems, possible bankruptcy
General Motors Co. faces a lawsuit filed by Spyker in the U.S. District Court in Detroit for over $3 billion on behalf of its subsidiary Saab, claiming that GM had intentionally bankrupted the Swedish group by opposing a deal with a Chinese investor. In May 2011, Saab Automobile halted production when it couldn’t anymore pay suppliers and workers.
Saab, which is one of the most famous brands in Sweden, was discontinued in December, almost two years after GM sold it to Spyker, the Dutch sportscar maker. Spyker said that GM’s attempts to prevent a sale were made to get rid of a potential rival in China. According to Spyker CEO Victor Muller, GM "had it coming" with regards to the lawsuit.
Muller told Reuters that they weren’t expecting to survive but then Spyker is “still here.” In its complaint, Spyker said that GM never meant to allow Saab to compete with it in China. Spyker said that when Saab discovered a way to secure liquidity and continue as a going concern with the help of Chinese investors, GM wanted to spoil the deal by using any methods it could think of, including publishing wrong information about its rights under the parties' contracts.Read the entire article Spyker sues GM for $3 billion over driving Saab into bankruptcy
The Nürburgring race track is headed for bankruptcy after it was denied a €13-million aid package that would have allowed the famous track to operate for six more months. This track owned by Rhineland-Palatinate is also known as the ‘Green Hell'. According to a report from Rhein-Zeitung, a German newspaper, the operating company has debts of €413 million, which include a €330 million Investitions und Strukturbank (ISB) loan as well as €83 million in other loans.
For several years, the Nürburgring has been hurting from the weight of its huge debt and losses. In 2004, the state invested €215 million for the expansion of the Nürburgring's complex. These plans include a leisure and business center with amusement park and hotel complex, which has been a dismal failure commercially.
The Nürburgring has been where the German grand prix has been held biannually with the Hockenheimring since 2007. This makes the 2013 Nürburgring race highly uncertain. In 1927, the Nürburgring track was opened. This was decided after the 1920s ADAC Eifelrennen, which took place on public streets in the Eifel mountains, was regarded too risky and impractical.Read the entire article Nurburgring will file for bankruptcy
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