Cash-strapped FSR.N, opens new tab The electric-vehicle startup's shares will be delisted by the New York Stock Exchange due to "abnormally low" prices after talks with a large carmaker faltered. On Monday, the NYSE announced it had delayed stock trading pending an announcement again. Fisker shares closed Friday at $0.13 from $0.09 before the halt.
On Monday, Fisker said it was exploring in- or out-of-court restructurings and capital markets transactions after talks with the unnamed automaker ended. Upon stock delisting, the business must offer to acquire its unsecured 2.50% convertible notes due 2026 and trigger an event of default under its senior secured convertible notes due 2025.
"We do not currently have sufficient cash reserves or financing sources sufficient to satisfy all amounts due under the 2026 Notes or the 2025 Notes, and as a result, such events could have a material adverse effect on our business, results of operations and financial condition," stated. The company halted electric-vehicle production a week earlier, raising questions about its future.
"I can't put it if it is next week or next year, but it is inevitable," Great Hill Capital chairman Thomas Hayes said of Fisker's bankruptcy chances. Henrik Fisker, an automotive designer and Tesla (TSLA.O) adviser, will fail his second vehicle business if Fisker goes bankrupt. Fisker Automotive, his previous venture, failed in 2013 despite receiving $192 million in DOE loans due to the 2008 financial crisis.
Fisker's 2016 startup went public after merging with a blank-check firm for $2.9 billion. However, supply chain concerns, production delays, and fundraising issues lowered its market capitalization to under $100 million. Reuters reported earlier this month that Nissan (7201.T), opens new tab, was in advanced talks to invest in the firm.
After missing an interest payment, Fisker warned Monday it will not meet a closing condition for its convertible note sale to fund $150 million. The business said it didn't pay $8.4 million for 2026 notes on March 15 despite having enough liquidity because it wanted to use the 30-day grace period to talk to investors about its capital structure. Loss-making EV businesses have struggled to increase production and deliver to consumers despite fierce competition and a challenging economy, making fundraising difficult.
To comply with New York Stock Exchange listing standards, Fisker said it would host a shareholder meeting on April 24 to vote on a reverse stock split. Fisker's shares have dropped more than 90% this year after the firm signaled going-concern risk in February and halted additional financing until it found a partner.
After logistics challenges caused it to deliver less than half of its 2023 vehicles, it switched to a dealer-partner strategy this year. Fisker, unlike Tesla and other EV companies, relies on auto supplier Magna to produce its vehicles rather of building and operating a facility. The Fisker Ocean faces Tesla's Model Y and a rising number of mid-size electric SUVs like the Ford Mustang Mach-E.
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