Fisker Automotive Files For Chapter 11 Bankruptcy

Nov 25, 2013 11:35 AM EST | Matt Mercuro

Fisker Automotive has filed for Chapter 11 bankruptcy protection this weekend.

Hybrid Technology, an investor group headed by Hong Kong billionaire Richard Li, is purchasing all of Fisker's assets, according to the automaker.

Hybrid Technology purchased the U.S. Department of Energy's loan of $25 million made to Fisker, as part of a plan to reorganize the company.

The Department of Energy put the loan up for auction back in Oct. after the automaker was not able to repay suppliers

"After having evaluated and pursed all other alternatives, we believe the sale to Hybrid and the related Chapter 11 process is the best alternative for maximizing Fisker Automotive's value for the benefit of all stakeholders," said Marc Beilinson, Fisker Automotive's chief restructuring officer, in a statement. "We believe that the Fisker Automotive technology and product development capability will remain a guiding force in the evolution of the automotive industry under Hybrid's leadership."

The U.S. Department of Energy said it will lose approximately $139 million on the loan to Fisker Automotive. The DOE froze payments to the automaker after giving it $192 million.

The sale of the loan puts the government's loss at $139 million when combined with money previously recovered.

"(The loss) represents less than 2 percent of our advanced vehicle loans and less than one half of 1 percent of our overall loan program portfolio," said the DOE in a statement.

Fisker most known for its Karma hybrid-electric luxury car, and was supposedly inspired to make hybrid vehicles thanks to actor Leonardo DiCaprio. 

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