Norwegian Think exits court protection and plans to resume production

TH!NK-city-Michigan-USA_imagelargePhoto Source: Think website

Norwegian electric carmaker Think announced on 27 Aug 2009 (see its press release) that the Norwegian courts have approved its debt settlement plan, enabling the company to exit court protection. This effectively puts Think back in business and to resume production of new electric vehicles (EVs), called TH!NK City model. (Update: On December 10th, Greentech Media reports that Th!nk is on track to deliver cars by Christmas.)

In addition, Think secured $47 million in new capital financing from new investors, namely Ener1 from the US, Valmet Automotive from Finland and Investinor, the Norwegian Government-backed investment fund.

Ener1 (Update: Strategic Partners are Argonne National Laboratories, Itochu) is the largest investors in Think and once the transaction is complete, will hold 31% equity stake of the company. Ener1 will invest about $18 million in 3 rounds and convert about $3 million in debt to shares of Think. Ener1 is the parent company of EnerDel, which supplies lithium-ion batteries to Think. EnerDel and Think have agreed to enter into a long-term battery supply agreement as part of the transaction.

Valmet Automotive will invest 3 million euros ($4.3 million) and as part of the deal, Valmet will start making TH!NK City cars in Finland this year. Think will close its Norwegian factory and lay off about 85 workers there. (Comment: Norwegian carmaker is now Finnish?) Valmet makes the Porsche Boxster, and is also to be the manufacturer of startup Fisker Automotive‘s high-end Karma hybrid – another company EnerDel plans to supply batteries to.

Investinor is a Norwegian venture fund backed by the Government’s Ministry of Trade and Industry. The fund invests in Norwegian companies on strict commercial terms in return for share capital, and is investing NOK30million ($5million) in Think’s capital increase. (Comment: So why didn’t the Norwegian fund push to keep the jobs in Norway since it has higher equity share than Valmet? Hmm…)

All in all, it’s a very good news for the company which was under the threat of bankruptcy earlier this year and was forced to halt its production of EVs just 2 months after it started. Think, which had raised about $85 million in venture capital as of last year (Kleiner Perkins, RockPort Capital, General Electric are some of its investors) reported early this year that it could be facing bankruptcy. Ener1 was one of the creditors that loaned about 40 million crowns ($5.7 million) to Think in January. And new and existing investors put about 250 million crowns ($39 million) into the company in June 2009.

In March 2008, Think also signed up lithium-ion battery manufacturer A123Systems to power its vehicles. (Comment: However, there may be doubts that the deal with A123Systems will go on as there was no further developments announced since then and because of the Ener1’s deal. Furthermore, Think and Ener1 successfully tested a lithium ion battery pack in June 2008. See TH!NK Tests Battery, But Where’s A123?)

Sources:
Think: We’re Back and Ready to Make Electric Cars
Think Gets $47M, Moves Production to Finland
Is Think Still a Norwegian Car Company?
Ener1 invests in Think, EV production to resume
Metso’s Valmet to start making Think electric car

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