Reuters top China automotive journalist, Norihiko Shirouzu, brings the background story on Fisker’s mercy trip to China where he was tasked with finding a suitor – the only issue being is that Fisker favored another partner over Geely’s deep pockets.
n late January, consultant Joel Ewanick arrived at Geely’s headquarters in eastern China to deliver an impassioned pitch on behalf of Fisker Automotive, the California-based boutique green-car maker that was running out of cash and sliding toward bankruptcy.
Ewanick, a former General Motors Co and Hyundai marketing executive, walked Geely Chairman Li Shufu through the pros and cons of taking a majority stake in Fisker. He suggested Geely could take control for as little as $250 million, about an eighth of Fisker’s self-estimated value in late 2011.
“Chairman Li’s eyes got big, and it was as if, ‘that’s all!?’” according to one of the people who attended the meeting.
The deal ultimately fell apart for many reasons, including hard-to-meet terms of Fisker’s U.S. government loan. But the outcome was also the result of missteps by Fisker’s top managers, including openly appearing to favor a rival Chinese automaker early on, according to eight individuals with direct knowledge of the effort over the past year.
By betting on the wrong company as its potential white knight, Fisker may have bungled an opportunity to raise hundreds of millions of dollars. Fisker’s board sent out at least two search teams, but proceeded without a clear roadmap or coordination between the teams, those knowledgeable individuals told Reuters.
The events show how Fisker’s last-ditch bid for survival has been just as messy as the mismanagement that led the company to burn through more than $1.4 billion in public and private funds in less than six years.