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Bankrupt EV startup Arrival sells assets to Canoo

Bankrupt commercial electric vehicle startup Arrival has sold some of its assets, including advanced manufacturing equipment, to Canoo, another troubled startup trying to make and sell electric vehicles.

The acquisition has been hailed as a cost-saving measure that will reduce capital expenditures by 20% at a time when Canoo is working to move from prototypes to commercial production. Canoo said the purchased assets will be loaded onto more than 20 container ships and shipped to the company’s Oklahoma facility. The company previously acquired all new and “similar new assets” owned by Arrival’s U.S. operations. It’s unclear whether Canoo has also acquired any of Arrival’s intellectual property.

Kanu did not respond to a request for comment.

Arrival announced in January that it planned to sell the assets and intellectual property of its UK unit after it filed for bankruptcy protection in the UK. Arrival, once valued at more than $13 billion and backed by Hyundai Motor and UPS, claimed it would revolutionize production at the UK unit. By manufacturing electric vehicles in compact “microfactories” located in the heart of cities.

Those plans, which included an electric bus, vans and even a car built specifically for Uber, fell through after burning through cash and multiple executives. Arrival has restructured at least three times – each time with job cuts – and shifted its focus from the UK market to the US in a bid to preserve capital. Arrival has never mass-produced any commercial vehicles and currently has a market valuation of approximately $7.7 million. After years of volatility and the stock price losing nearly all value, the company filed for bankruptcy.

Meanwhile, Kanu has his own predicament. After going public through a merger with a special purpose acquisition company, the company has struggled to produce electric vehicles, a striking design based on a “skateboard” architecture that mounts the battery and electric drivetrain beneath the vehicle’s cabin. in the chassis.

Canoo has previously reported that its sales pipeline exceeds $1 billion, a figure largely due to a deal with Walmart to purchase 4,500 items, with the option to purchase up to 10,000 items. However, the company has struggled to convert those sales into deliveries.

Canoo is essentially a pre-profit company that is burning through cash and has had to resume stock splits and issue more shares to stay afloat. Last year, the company moved to another tier on the Nasdaq exchange after its shares fell below $1, triggering a delisting notice.

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