GM loans $40 million to firm to acquire, retool shuttered Lordstown, Ohio, factory




GM loans $40 million to firm to acquire, retool shuttered Lordstown, Ohio, factory


By David Shepardson

WASHINGTON (Reuters) - General Motors Co (N:GM) confirmed on Monday it agreed to loan $40 million to an electric vehicle start-up to facilitate the acquisition of its shuttered Lordstown Assembly plant in Ohio.

Lordstown Motors Corp, which is 10% owned by Workhorse Group Inc (O:WKHS), bought the plant and equipment for $20 million in November as part of its ambitious plan to begin building electric pickup trucks by the end of 2020.

The loan agreement, which was reported earlier Monday by the Business Journal in Youngstown, was filed in Trumbull County last week.

Lordstown Motors has been working on the engineering of the new truck, "Endurance", and hired Rich Schmidt, a former director of manufacturing at Tesla (NASDAQ:TSLA) Inc, as chief production officer.

"We structured the sales agreement to help support Lordstown Motors’ launch plans for the Endurance pickup," GM spokesman Jim Cain said, who added it "allows them to take possession of the plant and to cover some operating expenses while they undertake their capital raise."

GM is not investing in the venture, but Cain said GM financing could rise to $50 million.

The fate of the sprawling northeastern Ohio plant became a political lightning rod after GM announced its planned closure in November 2018, drawing condemnation from U.S. President Donald Trump and many U.S. lawmakers.

Lordstown CEO Steve Burns told Reuters last month he hopes to have pre-production prototypes coming off the assembly line by April and to start production by November 2020 with an initial workforce of 400 hourly workers.

Burns said last month the company hopes to raise more than $300 million, the Business Journal reported. Burns told Reuters it retained Ohio investment bank Brown Gibbons Lang & Co in its capital fundraising effort.

GM and South Korea’s LG Chem (KS:051910) said Thursday they will invest $2.3 billion to build an electric vehicle battery cell joint venture plant in Ohio which will be one of the world’s largest battery facilities.

The plant, to be built near the Lordstown complex, will employ more than 1,100 people, the companies said.

As part of the Lordstown sale, GM has the option to lease land near the assembly plant that it could use for the battery plant.





Related News

Metro Bank likely to pick interim boss as next CEO: Sky News
Today, 00:15
(Reuters) - Britain's Metro Bank (L:MTRO) is likely to pick acting boss Daniel Frumkin as its next chief executive, Sky News reported https://news.sky.com/story/metro-bank-faces-pressure-to-hand-interim-chief-top-job-11936657 on Monday, citing
Gazprom deputy CEO Sereda moved to new role at export unit
Today, 00:12
MOSCOW (Reuters) - Gazprom (MCX:GAZP) deputy chief executive officer Mikhail Sereda is to take up a new role at the Russian gas giant's exporting arm, the company said on Monday. Sereda, 49, who is close to Gazprom chief executive Alexei
Spanish supermarket chain Dia appoints new Brazil CEO to lead restructuring
Today, 00:09
SAO PAULO (Reuters) - Spanish supermarket chain Dia (MC:DIDA) said on Monday it has appointed Marcelo Maia as chief executive of its Brazilian subsidiary to lead a restructuring process in Brazil, and as part of a broader global shakeup. Maia will
Sanders, Bloomberg trade insults as Democratic White House race heats up
Today, 00:06
By Tim Reid and John Whitesides RICHMOND, Calif. (Reuters) - Democratic White House contenders Bernie Sanders and Michael Bloomberg stepped up their attacks on each other on Monday, with Sanders accusing the media mogul of trying to buy the election
China's Hubei province reports 93 new coronavirus deaths on Feb. 17
Today, 00:03
BEIJING (Reuters) - The number of deaths in China's central Hubei province from a coronavirus outbreak rose by 93 to 1,789 as of Monday, the province's health commission said on its website on Tuesday. There had been a further 1,807 cases



Latest News
Metro Bank likely to pick interim boss as next CEO: Sky News
18.02.2020 00:15
(Reuters) - Britain's Metro Bank (L:MTRO) is likely to pick acting boss Daniel Frumkin as its next chief executive, Sky News reported https://news.sky.com/story/metro-bank-faces-pressure-to-hand-interim-chief-top-job-11936657 on Monday, citing an unidentified insider. Formal confirmation of an appointment could take place on Tuesday or
Read more
Gazprom deputy CEO Sereda moved to new role at export unit
18.02.2020 00:12
MOSCOW (Reuters) - Gazprom (MCX:GAZP) deputy chief executive officer Mikhail Sereda is to take up a new role at the Russian gas giant's exporting arm, the company said on Monday. Sereda, 49, who is close to Gazprom chief executive Alexei Miller, has been named first deputy of Gazprom Export. He also become general director of Gazprom Trading,
Read more
Spanish supermarket chain Dia appoints new Brazil CEO to lead restructuring
18.02.2020 00:09
SAO PAULO (Reuters) - Spanish supermarket chain Dia (MC:DIDA) said on Monday it has appointed Marcelo Maia as chief executive of its Brazilian subsidiary to lead a restructuring process in Brazil, and as part of a broader global shakeup. Maia will replace Marin Dokozic, who occupied the CEO position for about a year. It was not immediately clear
Read more
Sanders, Bloomberg trade insults as Democratic White House race heats up
18.02.2020 00:06
By Tim Reid and John Whitesides RICHMOND, Calif. (Reuters) - Democratic White House contenders Bernie Sanders and Michael Bloomberg stepped up their attacks on each other on Monday, with Sanders accusing the media mogul of trying to buy the election and Bloomberg saying the senator and his fervent supporters were hurting the party. Sanders
Read more
China's Hubei province reports 93 new coronavirus deaths on Feb. 17
18.02.2020 00:03
BEIJING (Reuters) - The number of deaths in China's central Hubei province from a coronavirus outbreak rose by 93 to 1,789 as of Monday, the province's health commission said on its website on Tuesday. There had been a further 1,807 cases detected in Hubei, the epicenter of the outbreak, taking the total in the province to 59,989.
Read more