Think secures interim financing to restart EV production

Oslo, Norway's electric car maker Think said today it secured financing that could pave the way to resuming production of vehicles.

Think secured interim financing of NOK 40 million ($5.7 million) to restructure the company, which could allow it to raise permanent equity capital and return to volume production of the Think City vehicle, the company said.

In December, Think halted production because of money problems: the credit crunch made it hard to raise capital and parts suppliers were demanding upfront payments. Think announced plans to lay off more than half its 250 employees if a funding source wasn't secured by mid-January, estimating it needed about 80 million kroner ($40 million) from the government in the form of loan guarantees, credit or capital (see Think halts electric car production, plans layoffs).

"This interim financing is an important step for us to be able to recommence production as soon as possible," Think CEO Richard Canny said in a release. "We have encouraging engagement with a number of potential new equity investors for our recapitalization process."

Think said the interim financing came from several lenders, including Ener1 Group, the control shareholder of Ener1 (AMEX: HEV), which has contracted to supply lithium-ion batteries to the Think City (see Ener1, Think demonstrate operational battery pack).

"The battery data we will draw from this early market introduction is invaluable to Ener1 Inc.’s continuing effort to remain on the leading edge of EV battery technology development," Charles Gassenheimer, CEO of Ener1 Group and chairman and CEO of Ener1, said in a release.

Think, previously owned by Ford Motor (NYSE: F), has gone bankrupt twice.

The Think City, which was in production for two months, can reach 65 miles per hour and travel up to 110 miles on a charge. Think planned to expand to the North American and European markets in 2009, doubling production to 10,000 vehicles a year (see Think electric cars coming to North America). The status of those plans is now in question.

In September, Think reportedly tried to raise up to $80 million in a third round of funding to boost production capacity (see Cleantech cash piles up in Israel). Think Global has raised $85 million to date from DFJ Element, Rockport Capital Partners, British Hazel Capital and CG Capital (see China clean coal IPO).

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