Solar car start-up Sono Motors is running out of money after financing talks fell through. Solar car numbers are now threatened with total failure – a protective shield is intended to avert bankruptcy.
The Munich solar car start-up Sono Motors is apparently on the verge of bankruptcy. After several failed negotiations with potential financiers, the management came to the conclusion “that Sono Motors GmbH is overindebted and there is a risk of insolvency”. The company announced this on Monday in a mandatory notification to the US Securities and Exchange Commission.
Due to the imbalance, one felt compelled to submit an application for a protective shield procedure to the insolvency court in Munich. The court still has to approve it.
In a protective shield procedure, companies initially have three months to draw up a restructuring plan. Creditors are not allowed to claim their money back during this time. The management can itself propose a court-appointed trustee, but remains at the helm and represents the company externally. That is why the protective shield is also considered a kind of “insolvency light”.
sun in the tank
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Sono Motors is hoping for a successful reorganization as part of the process. “Detours are part of founding a company and we will continue to strive in the future to implement sustainable solutions with our partners and thus contribute to the decarbonization of the vehicle market,” said co-founder Jona Christians in a written statement.
Solar business to save Sono Motors
Sono Motors announced the end of its solar car program Sion in February. The company had not been able to raise enough capital to start serial production. At the time, the founders Laurin Hahn and Jona Christians announced that they would concentrate on the development of solar technology in the future and continue as a supplier for other car manufacturers. About 300 jobs should be eliminated in the course of the restructuring.
However, the savings plan was apparently not enough to handle the solar car business. Because Sono Motors is in deep debt with its financiers. More than 44 million euros have to be booked for the reimbursement to the approximately 21,000 customers who have already advanced a down payment for the failed solar car.
In the past, Sono Motors had financed itself with so-called “community funding”, in which private consumers advanced up to 25,000 euros to finance the development of the new type of solar car. Lawyers now consider this procedure to be a prohibited deposit business.
According to the restructuring expert Dirk Schoene commissioned by Sono Motors, the “legacy” – i.e. the repayments to the fan community – are also the reason why the protective shield procedure was “absolutely necessary”.
To put it plainly: the available funds were apparently no longer sufficient to pay off the debts. According to a mandatory filing with the US Securities and Exchange Commission, Sono Motors has only 1.7 million so far. of the 44 million deposits repaid. The remaining customers are now threatened with total failure.
For a while it looked as if Sono Motors might be able to do it after all. The company was initially worth more than $2 billion on the US tech exchange Nasdaq. But there is almost nothing left of that today: the share has fallen by more than 90 percent since the start. Auditors are now expressing “considerable doubts” about the continued existence of the company.
On top of that, almost the entire supervisory board resigned in April, and Sono Motors then postponed the overdue annual balance sheet for 2022 indefinitely. There has already been a rebuke from Nasdaq for both, and in the worst case the Munich-based company could even be threatened with being kicked out of the tech exchange.
This article first appeared that wie der stern belongs to RTL Germany.
I’m a recent graduate of the University of Missouri with a degree in journalism. I started working as a news reporter for 24 Hours World about two years ago, and I’ve been writing articles ever since. My main focus is automotive news, but I’ve also written about politics, lifestyle, and entertainment.