Smith Electric gets $42M, to resume truck production

Kansas City, Missouri – Medium-duty electric commercial vehicles producer Smith Electric Vehicles has secured a $42 million commitment from Sinopoly Battery Limited, a worldwide leader in the research, development, production, distribution, and sale of Lithium-ion batteries and related EV products.

The first $2 million in funding has closed, and the remainder will be invested in two tranches pending milestones to be achieved by both companies in the coming months.

The $42 million investment will position Sinopoly as a strategic shareholder in Smith Electric. Under the agreement, Sinopoly will become Smith Electric's exclusive supplier for batteries in vehicle applications that are compatible with Smith Electric's platforms and customer requirements. Sinopoly will also become a preferred supplier for certain electric vehicle components that can be manufactured in its Hangzhou, China, facility.

"Demand for all-electric commercial vehicles is rapidly increasing in China, and Sinopoly's investment in Smith Electric highlights the important role we will play in the global marketplace," says Bryan Hansel, CEO of Smith Electric Vehicles. "This investment provides both companies with the opportunity to leverage the synergies between our operations while Smith maintains the financial and operational flexibility to scale manufacturing, transition and strengthen our supply chain, and move toward company profitability."

Cao Zhong, chairman and executive director of Sinopoly Battery Limited, says, "The combined expertise of Smith and Sinopoly, which will adopt the name of FDG Electric Vehicles Limited shortly, along with the macro-subsidy policy for alternative energy vehicles, uniquely positions us to capitalize on the rapidly growing commercial EV market in China and the U.S."

Smith Electric will resume production in its Kansas City, Missouri, facility in mid-summer 2014. The company temporarily suspended production in the fourth quarter of 2013 in order to transition its supply chain to Tier 1 suppliers, which will enable Smith Electric to produce its vehicles at a lower cost.

"Sinopoly's investment in Smith Electric Vehicles marks an important milestone in recapitalizing and restructuring the company in preparation for the public market," says Charles Gassenheimer, chairman of the board of Smith Electric Vehicles.

Source Smith Electric Vehicles