Th!nk City - Click above for high-res image gallery
As work on the City electric vehicle (EV) continued these past few years, the financial side of Think was going through some big ups and downs (bankruptcy). Today, the company is announcing that the upswing is continuing because Think has completed a $40 million equity increase "to support further product development and planned expansion into North American markets." What does that mean? Think says it "is now fully funded and expects to become cash flow positive in 2011."
The equity round was over-subscribed (it was originally going to be $30 million), and was co-led by Rockport Capital and Ener1. Rockport will increase the size of its holding in Think and become the number two investor (Ener1 is first). Think CEO Richard Canny told AutoblogGreen that this is all really good news for his company:
The money will not only be used to get the cars to the U.S., but will also allow Think to prepare the City for the right-hand drive markets like the UK and Japan.For us, it's a little bit like the tailwind is finally behind us. We've got the whole push to electrification and at the same time we've got the car on the road and the company is now in a really strong financial condition. The round was oversubscribed. We didn't need to bring in that much money, by bringing in some extra money, it gives us a little bit of flexibility to pick and choose some extra projects or accelerate some things that we wanted to do, so it's always good when you're fast and you're focused to also be well-funded. When you get those three things together, then you can really do some interesting things.
There was also a bit of a corporate shuffle, with Think board member Charles Gassenheimer, who is also the Chairman and CEO of Ener1 and works on the Think/EnerDel partnership for EV power-train supply, moving over to the Chairman of the Board position, effective immediately. The current chairman, Reidar Langmo, was moved down to vice chairman.
ELECTRIC CAR MAKER THINK TO DRIVE PRODUCT AND MARKET EXPANSION WITH ADDITIONAL $40 MILLION EQUITY
OSLO, Norway, 11 May, 2010: THINK has completed a US$40 million equity increase to support further product development and planned expansion into North American markets. With the new equity, THINK is now fully funded and expects to become cash-flow positive in 2011.
"The new equity round will help THINK take full advantage of the rapid growth of zero emissions vehicles around the world," said CEO Richard Canny. "The electric vehicle's time has arrived, and we are ready to take a leading role among the world's first global EV makers."
Headquartered in Norway, THINK has raised a total of US$87 million since last August, when it started a new phase of production with strategic partner Valmet Automotive of Finland, and has invested heavily in new product development in Europe and Asia. In January, THINK North America announced a new manufacturing facility in Elkhart, Indiana, and recently completed the initial phase of due diligence for a low-cost, long-term loan with the U.S. Department of Energy (DOE) to help fund the North American expansion.
"This last round of equity marks a powerful vote of confidence by THINK's investors at a time when world capital markets are under great stress," Canny said. "Completing our funding requirements will allow us to maintain momentum, accelerate key new initiatives and ensure that we capitalize on our first-to-market advantage."
The THINK City was the first highway-capable electric vehicle (EV) certified to European safety standards, and it will go on sale in the U.S. later this year. "While other companies have announced future production plans," Canny commented, "THINK has a proven electric vehicle in mass production today, and the benefit of 30 million miles of real-world EV experience over our 20-year history."
The investment round was co-led by RockPort Capital Partners, an investment fund co-located in Boston and Menlo Park, Calif., specializing in energy and clean technology, and Ener1 Inc., the parent company of advanced battery manufacturer EnerDel. Rockport Capital and Ener1 each increased its investment in THINK by $12.5 million. All of THINK's shareholders participated in the equity round.
"Our additional investment reflects our confidence in THINK as exceptionally well-positioned for success with a proven product and leading technology in electric drive systems," said Wilber James, co-managing general partner of Rockport Capital.
"This is a seminal event for THINK," commented Ener1 Chairman and CEO Charles Gassenheimer. "THINK's transformation into a company ideally placed to translate product advantage into market success is undeniable. Ener1 fully intends to invest further resources in THINK."
THINK also announced two changes to its Board of Directors. Gassenheimer was named Chairman of the Board, effective immediately. Incumbent Chairman Reidar Langmo was named Vice Chairman.
"We welcome Charles' leadership in his expanded role at THINK as chairman," Canny said. "He has made it clear to the THINK management team his dedication to accelerate new product development."
Canny said that with the closing of the equity funding, THINK will now pull ahead right-hand-drive products for markets such as Japan and the UK. He added that innovations to the THINK City will further solidify the company's leadership in the commuter car sector of the EV market.
Canny detailed several clear marks of progress at THINK:
- The equity round was over-subscribed, indicating the increasing confidence of THINK's investors in the company's future success.
- Accelerated progress with the DOE for a large-scale production loan to strengthen the company's positioning in the U.S.
- The company's strategic partner Valmet Automotive is assembling THINK City at the same plant in Finland where it builds the Porsche Cayman and Boxster.
- The company is following an aggressive schedule to mount production at its Indiana plant and plans to begin assembling electric vehicles in Elkhart during Q1 2011.
- The company will begin selling the THINK City in the U.S. this year. The first cars sold in the U.S. will be built in Finland until production in Indiana gets underway in 2011.
- THINK has announced projects to supply EV drivetrain systems to consortiums in Japan with Mazda, Japan Post and Itochu Corporation. With the equity round complete, THINK will further expand its business selling EV drivetrains, Canny said.
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THINK is a pioneer in electric vehicles and a leader in electric vehicle technology, developed and proven over 19 years. It is one of the few companies that are currently producing highway-ready, fully electric vehicles for sale – the THINK City. THINK is also a leader in electric drive-system technology, and was the first to offer a modular and flexible EV drive-train solution in the business-to-business sector. With its Scandinavian origins and sustainability mindset, THINK is one of the most carbon efficient car companies in the world.
THINK has established a U.S. subsidiary – THINK North America, a stand-alone business that will include manufacturing, product development, sales and distribution. The company has an active application before the U.S. Energy Department under the $25-billion Advanced Technology Vehicle Manufacturing loan program designed to spur development of more fuel efficient vehicles, including pure electric and hybrid electric vehicles. More information about THINK is available at www.thinkev.com.