Morgan Stanley Says Bankrupt EV Firm Owes $10 Million Deal Fee
(Bloomberg) — Morgan Stanley claims it wasn’t paid most of a $12 million fee for advising now-bankrupt electric-vehicle technology firm Ideanomics Inc. on its acquisition of VIA Motors years earlier.
The transaction fee was described in a claim Morgan Stanley filed the day after Christmas in Ideanomics’ Chapter 11 case. The firm says it’s still owed more than $10 million for advisory work on the VIA Motors acquisition, which closed in January 2023.
Morgan Stanley acted as an exclusive financial adviser to Ideanomics on the acquisition, which — at the time it was announced in 2021 — valued electric-vehicle maker VIA at as much as $630 million, according to a press release.
The acquisition was part of a broader strategy to acquire electric-vehicle assets and technology between 2021 and 2023. But most of Ideanomics’ investments from that time “were unsuccessful, or continue to remain a substantial liquidity drain,” the company’s Chief Restructuring Officer Alpesh Amin said in a December bankruptcy filing. Ideanomics spent about $320 million to fund the acquisitions, he added.
A representative for Morgan Stanley declined to comment. Lawyers for Ideanomics didn’t immediately return messages sent Monday seeking comment.
Ideanomics paid a $2 million “announcement fee”, which Morgan Stanley said it credited the company for. The unpaid portion of the fee will be treated in bankruptcy court as unsecured debt, which is usually repaid in Chapter 11 for pennies on the dollar.
An entity linked to Shane McMahon, the company’s executive chairman, is funding the bankruptcy and has also offered to acquire the firm’s assets, according to court documents. McMahon is the son of Linda McMahon, who is expected to be nominated as President-elect Donald Trump’s nominee for education secretary, and Vince McMahon, the former chief executive officer of World Wrestling Entertainment.
The case is Ideanomics Inc., number 24-12728, in the US Bankruptcy Court in the District of Delaware.
More stories like this are available on bloomberg.com
