Workhorse Group Acquires $35 Million to Fund Electric Vehicle Orders

Workhorse Group has secured funding from Marathon Asset Management, which will provide funds in two separate tranches. A $10 million lump sum will be paid out and used principally to satisfy repayment of the July 2018 senior secured notes. The remaining $25 million will function as a revolving credit facility from which Workhorse may draw down as necessary to meet existing and future purchase orders of their electric vehicles, whether it be trucks from the line of delivery vehicles or the Surefly octocopter.

In June of 2018, UPS had placed record-breaking order for 950 Workhorse electric delivery trucks, which jumpstarted the electric vehicle startup.

Marathon Asset Management is a global investment advisor based in New York, NY with approximately $15 billion of capital under management, according to a release. “The firm pursues credit through a broad spectrum of investments in global corporate credit, distressed and special situational credit, structured credit, emerging markets and leveraged loans. A perfect fit for Workhorse’s needs, Marathon is uniquely positioned to quickly create innovative financing solutions that fit within Workhorse’s existing capital structure and its business objectives.”

Visit The Hangar to read more about the Workhorse Surefly’s technical specifications.

Workhorse CEO Steve Burns remarked:

“Marathon is the right strategic partner for Workhorse’s current capital needs, and we plan to leverage their experience, size and resources to further support our growth as a company. This agreement provides meaningful, near-term funding that will go directly toward building and delivering vehicles to customers in 2019. Additionally, we have repaid, in full, our previous debt obligations from July, which will remove all covenants associated with that arrangement, including the obligation to sell our eVTOL aircraft, SureFly. Going forward, our primary goal for both current and future capital initiatives is to leverage the best available financing solutions that will provide liquidity and favorable economics.”

Further, Duane Hughes, Workhorse President and COO, added:

“Completing these financial transactions and developing these strategic relationships are additional key steps in our long-term capital strategy. We plan to implement these measures and other near-term initiatives in the coming months to help drive continued growth in both sales and profitability.”

Why it’s important: As Workhorse competes for market share with other electric truck and delivery vehicle companies, this additional funding enables continued company growth and order fulfillment. Furthermore, immediate access to additional capital satisfies existing obligations to debt repayment and widens opportunities for sale of the Surefly eVTOL octocopter.