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Lordstown Motors and Foxconn logo is seen in this illustration taken, May 2, 2023. REUTERS/Dado Ruvic/Illustration/File Photo Acquire Licensing Rights
Aug 28 (Reuters) – Lordstown Motors is formulating a debt repayment plan and is hopeful that it will find buyers in Chapter 11 for all or parts of its business, Bloomberg News reported, citing the electric truck manufacturer’s attorney Thomas Lauria.
The company filed for bankruptcy protection in June and put itself up for sale after failing to resolve a dispute over a promised investment from Taiwan’s Foxconn (2354.TW).
“We expect to have one-or-more purchasers,” Lauria told Bloomberg.
A U.S. judge on Monday ruled out Foxconn’s bid to curtail Lordstown’s efforts at seeking bankruptcy protection in the U.S., marking a shot in the arm for the troubled EV manufacturer embroiled in legal disputes.
Judge Mary Walrath refused to dismiss Lordstown’s bankruptcy petition. Foxconn, formally called Hon Hai Precision Industry (2317.TW) and best known for assembling Apple’s (AAPL.O) iPhones, has said Lordstown breached the investment agreement when the automaker’s stock price fell below $1.
Several investor groups have also brought claims against Lordstown, alleging that the Lordstown misled consumers and investors.
The U.S. Securities and Exchange Commission (SEC) is investigating those claims as well, and is engaged in confidential settlement talks with the regulator, Lordstown’s attorney Thomas Lauria had said in a court hearing in June.
Lordstown and Foxconn did not immediately respond to Reuters’ request for comment on the ruling.
Reporting by Kanjyik Ghosh and Jahnavi Nidumolu in Bengaluru; Editing by Rashmi Aich
Our Standards: The Thomson Reuters Trust Principles.
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