Struggling EV Startup Mullen Auto Bids for Bankrupt Electric Last Mile
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Troubled EV startup Mullen Automotive Inc. has emerged as the leading bidder for the assets of bankrupt competitor Electric Last Mile Solutions Inc., including a now-idle former Hummer SUV factory in Indiana.
Mullen agreed to a stalking horse bid of “almost $100 million in total consideration,” according to a Sept. 16 filing by the trustee in Electric Last Mile’s Chapter 7 case. Competing bids are due by Oct. 3, and an auction will be held Oct. 7.
ELMS’ first vehicle, the Urban Delivery, was anticipated to be the first Class 1 commercial electric vehicle in the U.S. market.
Details of the offer come after Mullen, which aims to bring electric vehicles to market including a compact SUV and a sports car, announced it was acquiring a majority stake in rival Bollinger Motors in a cash-and-stock transaction.
Mullen didn’t immediately respond to a request for comment.
The firms are among a number of EV startups struggling to break through in a market dominated by Tesla Inc. at a time of overstretched supply chains and high costs. One day after the Bollinger deal was announced, Mullen, whose stock has declined about 90% this year, revealed it had fallen out of compliance with Nasdaq’s minimum share price requirements.
The shares fell 5.7% in midday trading Sept. 19 in New York.
The trustee has said that as many as 245 potential strategic or financial parties were solicited for the assets of Electric Last Mile, which filed for bankruptcy in June, and that 39 of those have executed non-disclosure agreements to perform due diligence and potentially make a bid. Securing Mullen as a stalking horse bidder “represents a tremendous benefit to the debtors’ estates and creditors,” he wrote in the Sept. 16 filing.
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