Workhorse, the electric truck maker involved in a proposed deal to acquire an idled General Motors factory in Ohio, said Monday it had raised $25 million from investors.
The company, based in Cincinnati, said the money would come from an unnamed group of institutional investors and was not intended to go toward the purchase of the G.M. plant. In a regulatory filing earlier this year, Workhorse said it needed to raise $22 million to continue as a going concern and begin making delivery trucks for UPS, DHL and its other customers.
Up until recently, Workhorse had operated in virtual obscurity. But the 12-year-old company made headlines last month when G.M. said it was having discussions with Workhorse’s founder and former chief executive about buying the automotive giant’s plant in Lordstown, Ohio.
President Trump, who has criticized G.M. for ending production in Lordstown, disclosed the potential sale hours before G.M. announced it in early May.
Workhorse intends to take a minority stake in the unnamed company that Steve Burns, the company’s former chief executive, said he formed to buy the factory. Mr. Burns has said he needs to raise about $300 million to acquire and restart the plant, which G.M. had used to produce a small car, the Chevrolet Cruze.
Mr. Burns did not immediately respond to an email seeking comment.
In return for providing Workhorse with cash, investors are getting preferred stock and warrants to purchase shares. The preferred stock comes with an annual dividend that is paid out in shares of Workhorse stock.
The warrants have an exercise price of $1.62 a share and can be immediately exercised by the investors, according to a regulatory filing. Shares of Workhorse were trading around $2.80 on Monday, up nearly 23 percent.
“This funding provides Workhorse with sufficient capital to fully deliver on our existing backlog,” Duane Hughes, Workhorse’s chief executive, said in a statement.
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