A Taiwanese manufacturer is increasing its investment in an EV startup.
After the deal is done, Foxconn will hold all of Lordstown's outstanding preferred stock and common stock on a pro forma basis. The companies said that they will have two board seats.
A year ago, the electric light-duty truck manufacturer sold its Lordstown, Ohio, factory to Foxconn. The $230 million deal included a direct investment of $50 million by Foxconn, which will be used to make a pickup truck. The electric pickup truck was produced.
The $100 million direct preferred stock investment is the replacement for the joint venture funding announced last year by the two companies. The investment will be reviewed by the Committee on Foreign Investment in the US.
The initial closing is expected to take place later this month. The company will purchase about 12.9 million shares of common stock at a purchase price of $1.76 per share. There will be $30 million in proceeds from the purchase of 300,000 preferred stock by Foxconn. The remaining shares of preferred stock will be bought by the company. After receiving approval from the Committee on Foreign Investment in the United States, Foxconn will buy an additional 26.9 million shares of common stock at a purchase price of $1.76 per share, resulting in total proceeds of 888-492-0 888-492-0s.
Since announcing our first transaction with Foxconn more than a year ago, it has been our goal to develop a broad strategic partnership that uses both companies' capabilities. The latest investment by Foxconn is a step in the right direction.
A new injection of capital will be used to fund development and design activities for a new electric vehicle program in collaboration with a well-known manufacturing company.
Over the past two years, several companies went public by merging with a special purpose acquisition company with a market value of over a billion dollars.
The company's demise was caused by a report that accused the EV SPAC of misleading investors on both its demand and production capabilities. The company booked 100,000 preorders for its electric pickup truck, according to a report.
The company's CEO and CFO resigned. Just a few weeks ago, Burn reassured investors of the company's bright future. The EV startup is under investigation by the US Securities and Exchange Commission and the Department of Justice.
Lordstown lost GM as an investor after receiving a $400 million lifeline from a hedge fund.
Even though supply chain issues are limiting production of its EV pickup, its deal with Foxconn has been its best chance of survival.
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