Drivers given green light to buy bankrupt electric car firm
Group led by solar-energy entrepreneur Yosef Abramowitz wins court approval to take control of Better Place Israel for less than $5 million
Gavriel Fiske is a reporter at The Times of Israel
A consortium of Better Place electric car owners, who banded together to try to salvage the pioneering firm, received court permission Wednesday to acquire the bankrupt company for some 18 million shekels (less than $5 million).
The group, led by solar-energy entrepreneur Yosef Abramowitz, pledged to employ at least 50 Better Place staff members and to maintain at least 15 of the company’s 30-plus battery exchange stations nationwide for two years, Army Radio reported.
In additional to acquiring the Better Place Israel assets, the group received permission to buy Better Place Switzerland’s intellectual assets for some NIS 25 million ($6.8 million), subject to approval by a Swiss court, Globes reported.
The owner consortium, the Association for the Promotion of the Electric Car, was formed expressly for the purpose of buying Better Place, and in the acquisition beat out a group comprised of Success Parking of Israel and Car Charging Group of the US.
Better Place, started by Shai Agassi, raised more than $800 million for the revolutionary concept of electric car batteries that could be quickly swapped out at dedicated stations, which would eliminate the need for lengthy charging and greatly increase vehicle range.
But Agassi was fired last fall and the company went belly up in May, citing losses totaling almost a billion dollars. Since then, court-appointed liquidators have been processing various proposals for the firm.
In addition to maintaining the basic functionality of the company, Abramowitz and his team of Better Place car owners aim to have Better Place declared a national infrastructure project, eventually becoming a national technology and service platform for all electric vehicles in the country.
The company has only $9.5 million in assets and has lost over $800 million since it was established — $454 million of that last year alone. Part of the problem stemmed from Agassi’s original plan to build the battery switching stations, which drove overhead costs up, as each one cost some $500,000 to construct.
The company had only attracted some 1,000 drivers throughout all of Israel, each of whom NIS 160,000 ($44,000) for their electric Renault Fluence. But some of the drivers banded together to try to save the company.
“We see in this a national infrastructure worth hundreds of millions, and which is one of the most advanced in the world,” said high-tech consultant Efi Shahak, one of the Better Place car owners in the successful group. “It’s an unbelievable number of working stations. This is [on the cutting edge of] the current technology of electric vehicles, and Israel is the only place that has it: 37 stations, 2,000 curbside [charging] stands and 1,000 cars. It doesn’t make sense to throw it out.”
Jessica Steinberg contributed to this report.
