Better Place Inc. has asked its shareholders for an immediate capital injection of, following the ouster of CEO Shai Agassi last week. Sources estimate that the company is seeking to raise $130-140 million. The electric car venture's biggest shareholder is Israel Corporation (TASE: ILCO).
The request for the capital injection is due to Better Place's cash flow problems. The company had $122.8 million in cash at the end of June. Its balance sheet was almost zero, and it has no financial debt, except to its senior shareholders. The company spent $104.1 million in the first half of 2012, which is probably why it is nearing the moment when it needs the capital injection to avoid collapse.
Better Place's board of directors ousted Agassi last week and replaced him with Better Place Australia CEO Evan Thornley. Agassi was ousted because the company failed to meet its sales targets. Sales were too low compared with its cash burn rate.
An examination by "Globes" found that Better Place has raised $751 million in three financing rounds to date, but has had no profits at all. Israel Corp., controlled by chairman Idan Ofer through Ofer Holdings Group, has invested $227 million in Better Place.
Published by Globes [online], Israel business news - www.globes-online.com - on October 9, 2012
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