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Electric-Car Maker Coda Files for Bankruptcy to Seek Sale

Coda Holdings Inc., parent of the electric-car maker backed by billionaire Philip Falcone, filed for bankruptcy and will seek to sell its assets to a group led by a Fortress Investment Group LLC (FIG) unit for $25 million.

The Los Angeles-based company, whose Coda Automotive unit also sought court protection, listed assets of as much as $50 million and debt of as much as $100 million today in the Chapter 11 filing in Wilmington, Delaware. The company said it intends to sell its assets within 45 days.

Coda’s bankruptcy is at least the third by an electric vehicle-related company in just over a year. A123 Systems Inc. (AONEQ), a battery supplier to Fisker Automotive Inc., another California-based maker of electric cars, filed for bankruptcy in October. Ener1 Inc., also a maker of batteries for electric cars, entered bankruptcy in January 2012.

While A123 and an Ener1 unit received U.S. government funds, Coda didn’t. The company applied for a $334 million loan in May 2010 and withdrew the request in April 2012.

“After two years of uncertainty, we needed to move forward with our business plan independent of the loan,” Matt Sloustcher, a Coda spokesman, said in an e-mail today.
Production Delays

Coda was forced to seek bankruptcy protection because of production delays, insufficient capital to market and sell its sedan, and slow growth for the electric-vehicle market, which it blames on the scarcity of charging stations, according to a declaration by Chief Restructuring Officer John P. Madden. Coda will focus on its energy-storage business, Chief Executive Officer Phil Murtaugh said in a statement today.
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