European bus manufacturer Ebusco has received a 5.1 million Euro (roughly $8.8 million AUD) loan to safeguard the ongoing delivery of its buses.
The loan comes from Heights, De Engh, PBH and N-Works and arrives after Ebusco reported that its liquidity constraints continue to persist on November 3.
At the time, the manufacturer said it continues to do its upmost to implement remedial actions such as using the nine million Euro working capital facility made available by one of its partners in China, as well as the agreement made with a Chinese contract manufacturer under which inventories related to the Ebusco 3.0 bus model are expected to be bought and financed locally.
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“The implementation of the remedial actions referred to above is somewhat delayed,” Ebusco says.
“The discussions are ongoing based on good relationships with the Chinese partners and Ebusco is confident on realising the desired outcome.”
To avoid delaying the bus delivery schedule and avoid corresponding contractual penalties for late delivery, Ebusco secured the working capital bridge loan.
Ebusco says the loan will allow the manufacturer to deliver the buses on time and stabilise the business.
“The loan, which contains customary terms and conditions for a loan of this nature, will be repaid by Ebusco over time through the cash proceeds from bus deliveries and has a final maturity date of May 1, 2026,” Ebusco says.
“In the event of any outstanding principal amount on the final maturity date, such amount (including any accrued interest and any unpaid fees) will mandatorily convert into Ebusco shares at a conversion price that equals a 15 per cent discount to the five-business day Volume Weighted Average Price of the Ebusco shares preceding the final maturity date.”
The ongoing saga continues after Ebusco closed its Australian operations in March 2024 following earlier electric bus model launches locally in 2022, before the brand also unveiled a ‘turnaround plan’ following the loss of a court case in the Netherlands in October last year.
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