EV startup ELMS files for bankruptcy after several failures

Electric Last Mile Solutions (ELMS), the former head of the Hummer brand and the former CEO of Ford China, is liquidating its assets through a Chapter 7 bankruptcy process.

The decision was made a year after the company was first listed on the public list and after the resignations of its founders James Taylor and Jason Luo, as well as the SEC’s investigation into its accounting processes. The company said in a statement late Sunday that it would file for bankruptcy.

In the release, interim CEO Shauna McIntyre said she decided to liquidate the company after finding no better option for shareholders, creditors and other stakeholders. Its shares fell 55 percent in preliminary trading on Monday to 23 cents a share, according to the report. Bloomberg.

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Electric Last Mile Solutions planned to import electric vehicles from China and assemble them at a former GM plant in Mishawaka, Indiana. In June 2021, the company Forum Merger III Corp. shares with the company, which brought the company about $ 379 million in revenue.

In February, its founders resigned after ELMS accused it of buying shares incorrectly before announcing the SPAC merger in December 2020. A week later, his auditor, BDO LLP, also resigned. Therefore, it has not yet submitted an annual report for 2021 or quarterly reports for this year, which makes it inconsistent with Nasdaq listing rules.

This non-reporting eventually led to an SEC investigation announced by the company in March 2022. At the same time, it reduced its workforce by 24 percent, all of which led to a 93 percent drop in its shares by January 1 and the end of 2022. last week’s trade.

“I am very disappointed with this result, as our ELMS team has made a great decision to be ready to meet the critical needs for clean, connected vehicles that reduce carbon emissions from ground transportation of our electric vans,” McIntyre said. “Unfortunately, there were too many obstacles to overcome in the short time available to us.”