BREAKING | Lordstown Motors, Foxconn finalize deal to sell plant for $230M

LORDSTOWN — Lordstown Motors Corp. has finalized a deal with Taiwanese electronics manufacturer Foxconn to sell its 6.2-million square-foot plant for $230 million, according to a Wednesday news release.

The deal is expected to close by the end of April 2022.

Here are the details from that release:

• LMC has agreed to sell to Foxconn the Lordstown facility, excluding certain assets such as the hub motor assembly line and battery module and pack lines, for $230 million.
  
  
• Foxconn has agreed to make a down payment of the purchase price of $100 million by Nov. 18, and subsequent down payments of $50 million on each of Feb. 1, 2022 and no later than April 15, 2022. The balance of the purchase price will be paid at closing.
  
  
• The parties have agreed to pursue a contract manufacturing agreement for the Endurance pickup truck, which must be entered into before closing — currently targeted by April 30, 2022.
  
  
• Lordstown Motors and Foxconn will pursue a joint venture agreement to co-design and develop vehicle programs for the global commercial fleet market, using [Foxconn's open platform for electric vehicles]. Lordstown and Foxconn would have the right to commercialize these new EV programs in North America and internationally.
  
  
• Upon the closing, Foxconn will receive 1.7 million warrants to acquire Lordstown common stock, exercisable for three years, at a price of $10.50 per share.

The plant-sale deal was initially announced in late September and was expected to be finalized by the end of October. Following the initial agreement, Foxconn, which is formally known as Hon Hai Technology Group and which manufactures Apple iPhones, purchased $50 million in Lordstown Motors common stock "as a sign of confidence in the partnership," according to the Wednesday release.

At the time of the announcement, integration at the Lordstown plant was expected to begin in April 2022, a spokesperson said.

"We are happy to have formed a strategic partnership with a company as innovative and forward-thinking as Foxconn," Lordstown Motors CEO Daniel Ninivaggi is quoted in the release. "I believe in their [electric vehicle] strategy and look forward to substantial collaboration in the future. In my view, this transaction provides LMC a better opportunity to fulfill its original mission of satisfying the growing demand for electric vehicles, particularly in the underserved commercial market, with a more flexible business model."

Going into the deal, Foxconn had already partnered with electric vehicle-maker Fisker Inc. to manufacture an electric vehicle, and plans to build that vehicle at the Lordstown plant. The shared space allows smaller automakers to benefit from the scale of the facility, according to the release.

"This partnership marks the commencement of integrating our resources with Lordstown Motors to develop Ohio into Hon Hai's most important electric vehicle manufacturing and [research and development] hub in North America," Hon Hai Technology Group Chairman Young Liu is quoted in the release. "As we look to inject Hon Hai's software and hardware capabilities in the information and communications industry with the wealth of automotive experience that resides in this town and our partners, we will be able to provide customers with more real-time and efficient electric vehicle products."

This story was originally published November 10, 2021 at 5:36 PM with the headline "BREAKING | Lordstown Motors, Foxconn finalize deal to sell plant for $230M."