US Fisker, Whose Stock Plummeted 95% Amid 'Bankruptcy Concerns,' Ultimately Delisted

by Cho Seulkina

Published 26 Mar.2024 10:34(KST)

Fisker, a US electric vehicle startup that was engulfed in bankruptcy fears due to financial difficulties, was ultimately delisted from the New York Stock Exchange. The stock price just before trading was only 9 cents per share.

[Image source=Reuters Yonhap News]

The New York Stock Exchange (NYSE) officially notified Fisker of its delisting on the 25th (local time), citing the company’s failure to meet listing requirements, including trading below $1 for an extended period. Before trading was halted at 9:35 a.m. Eastern Time that day, Fisker’s stock price fell 28% from the previous close to 9 cents, marking a staggering 95% plunge since the beginning of the year.

Fisker’s stock price has remained below $1 throughout this year. Accordingly, the NYSE had issued a notice of violation to Fisker last month, warning of the possibility of delisting.

Founded by Danish automotive designer Henrik Fisker, Fisker was once considered one of the leading electric vehicle startups aspiring to become the “second Tesla.” However, amid a slowdown in electric vehicle demand and intensifying market competition, the company faced financial difficulties due to a combination of production issues and regulatory investigations stemming from technical defects.

In mid-month, Fisker secured a $150 million funding commitment from existing investors, but the deal fell through as an investment agreement with a major automaker, one of the conditions of the funding, was not finalized. Fisker is currently reported to be negotiating new terms with investors. The company stated it will “explore strategic options, including restructuring and capital market transactions.”

Fisker disclosed that its revenue last year was $273 million, while its debt reached $1 billion. At its earnings announcement last month, Fisker warned of “significant doubt” about its ability to continue as a going concern.

Local media, including Bloomberg News, also reported that Fisker failed to pay interest on some convertible bonds earlier this month, raising the possibility of bankruptcy. The Wall Street Journal (WSJ) previously reported that Fisker had contracted financial advisory firm FTI Consulting and law firm Davis Polk in preparation for potential bankruptcy risks.