CarCharging Group Announces Acquisition of Ecotality’s Blink Network
CarCharging Group emerged today as the winner of an auction for the rights to Ecotality’s assets following the defunct company’s bankruptcy filing last month. The amount of CarCharging Group’s bid was not formally announced but it is likely in excess of a $3 million opening stalking horse bid by Irvine, Calif.-based Tellus Power. Stalking horse bids are often negotiated by a company entering bankruptcy to ensure a floor price for its assets and ensure that lowball bidders aren’t able to win the auction in the absence of a serious contender.
Thankfully for Ecotality stakeholders—including the municipalities and thousands of plug-in vehicle drivers throughout the country—Ecotality not only found a serious buyer but one with an established EVSE network. CarCharging Group is a publicly traded company based in Miami, Fla. with a network of at least 1,000 public chargers. Last year, CarCharging Group acquired another failed charge provider, 350Green. Ecotality will make the fourth such acquisition of a competitor undertaken by the company since its founding.
CarCharging Group is scheduled to file papers with the bankruptcy court tomorrow explaining which assets it purchased and plans to maintain, but in a press release today the company announced that the acquisition would include “more than 12,450 installed electric vehicle Level 2 charging stations, the 110 DC Fast charging stations, and the Blink network.” The sale will not include Minit-Charger or ETEC Labs, two Ecotality subsidiaries involved in the manufacture, design and distribution of charging equipment.
Help May Be on the Way for Broken Blink Chargers
In a conference call hosted by the Los Angeles Economic Development Corporation and Southern California Association of Governments today, Howard Steinberg of Greenberg Traurig, an international law firm, said that Ecotality “had technical problems which resulted in damage to vehicles that they reported to the Department of Energy and the Department of Energy cut off further funding.”
Participants in the call included stakeholders and municipalities, many of which were concerned about whether Ecotality’s new owners would continue to honor agreements with public charge hosts after the acquisition, including the responsibility to service a growing number of broken and malfunctioning chargers in the network. Steinberg informed them that any purchaser that takes possession of those chargers would indeed be liable for servicing agreements, a condition that is likely to apply to home chargers in the Blink Network as well.
That could be good news for numerous EV Project participants that have been without home charging service after a recent flaw tcaused a number of Blink charge cables to effectively melt due to higher voltage charging. As Ecotality itself melted down over the last few months, those plug-in owners have been unable to get service from the company. How soon CarCharging Group is be able to remedy the situation remains to be seen, but expect to hear more from the company soon.
Is There a Future for Privately-Owned Public Charging Networks?
The cause of Ecotality’s downfall can be linked to a number of factors, but there's a basic reality underlying the bankruptcy: there is no demonstrated model under which public charging can be profitable. Ecotality received more than $100 million for the Department of Energy in addition to private capital from investors, but burned through that money quickly while bringing in minimal revenue.
CarCharging Group itself reported quarterly revenue from charging fees of less than $33,000 for the first quarter of this year, while shelling out millions of dollars for the depleted assets of Ecotality and 350 Green. Does the company have enough money to keep its rapidly-expanding network operational until it reaches profitability? With a share price of just $0.89 off a high of more than $6 two years ago, the market appears to have a clear answer to that question.
UPDATE: According to Dow Jones, Blink Acquisitions (presumably an investment vehicle set up by CarCharging Group for the purpose of the auction,) bid $3.3 million for Ecotality. The two Ecotality subsidiaries were also acquired in the auction. Minit-Charger was purchased by Access Control Group LLC for $250,000 and ETEC Labs was purchased Intertek for $750,000, bringing the total auction value of Ecotality's post-bankruptcy assets to $4.3 million.
Investors responded positively to the news, boosting CarCharging Group's stock value by almost 10 percent by day's end.
New to EVs? Start here
Electric Cars Pros and Cons
EVs are a great solution for most people. But not everybody.
Seven Things To Know About Buying a Plug-In Car
A few simple tips before you visit the dealership.
Incentives for Plug-in Hybrids and Electric Cars
Take advantage of credits and rebates to reduce EV costs.
Buying Your First Home EV Charger
You'll want a home charger. Here's how to buy the right one.
The Ultimate Guide to Electric Car Charging Networks
If you plan to charge in public, you'll want to sign up for charging network membership (or two).
Electric Vehicle Charging for Businesses
How do you ensure that electric car owners will be happy with every visit to your charging spot?
How to Use the PlugShare EV Charging Station Tool
Locate EV charging stations and optimize their use with a powerful mobile app.
Quick Charging of Electric Cars
Add 50 to 60 miles of range in about 20 minutes. Here's how.
The Real Price of EV Public Charging
Compare the cost of charging on the road to what you pay at home.
Electric Vehicle Charging Etiquette
Thou shalt charge only when necessary. And other rules to live by.