Introduction
The electric-bike maker Rad Power Bikes has agreed to sell its assets to Life Electric Vehicles Holdings (Life EV) for about $13.2 million. The deal follows a bankruptcy filing that began a month earlier and a competitive auction that drew bids from five parties.
At a Glance
- Rad Power Bikes sold for $13.2 million to Life EV.
- The auction’s winning bid was $14.9 million when liabilities were included.
- The sale marks a steep drop from the company’s peak valuation of $1.65 billion in October 2021.
Why it matters: The transaction signals a turning point for a once-dominant micromobility brand and illustrates the broader volatility in the electric-vehicle sector.
Acquisition Details
The auction took place on January 22, with five entities submitting offers. The first bid of $8 million was quickly outbid, and the competition culminated in Life EV’s final bid of $13.2 million. When the company’s outstanding liabilities were factored in, the total transaction value rose to $14.9 million.
Retrospec, an e-bike firm, submitted the second-highest bid of $13 million and has been named the backup bidder should the Life EV deal falter.
The price reflects a sharp discount to Rad Power’s peak valuation of $1.65 billion in October 2021, according to PitchBook data. The company had raised a cumulative $329.2 million over its lifetime.
Rad Power’s Background
Rad Power Bikes, founded in 2015, experienced explosive growth during the pandemic, driving a surge in sales and a corresponding increase in production capacity. As the pandemic-era momentum waned, the company faced declining demand, leading to multiple rounds of layoffs and executive turnover.
Safety concerns also emerged. The Consumer Product Safety Commission documented 31 reported fires linked to older battery models. In response, Rad Power stated it “firmly stands behind our batteries and our reputation as leaders in the e-bike industry, and strongly disagrees with the CPSC’s characterization of certain Rad batteries as defective or unsafe.”
Other Micromobility Companies in Bankruptcy
Rad Power is not alone in seeking bankruptcy protection. VanMoof and Cake have both undergone restructuring and secured new ownership, while scooter operator Bird also navigated a bankruptcy process. These cases underscore the challenges of scaling micromobility businesses amid shifting market dynamics.
Life EV’s Plans and Future
Life EV, a Florida-based developer and distributor of light electric vehicles, expressed optimism about the acquisition. CEO Robert Provost wrote, “There is still a process underway and there is an exciting future being planned for Rad Power.”
The statement suggests that Life EV intends to integrate Rad Power’s product line and brand equity into its own operations, though specific integration strategies remain undisclosed.
Regulatory and Safety Issues
The CPSC’s battery fire findings have cast a shadow over Rad Power’s reputation. While the company maintains confidence in its battery safety, the incidents highlight the importance of rigorous testing and compliance in the electric-vehicle industry.
Life EV will need to address these safety concerns as part of the transition, ensuring that any future product releases meet or exceed regulatory standards.
Next Steps
The sale still requires approval from the bankruptcy judge. Once sanctioned, Life EV will assume ownership of Rad Power’s assets, including its manufacturing facilities, inventory, and intellectual property.
Stakeholders-employees, suppliers, and customers-will watch closely to see how the transition unfolds and whether the new ownership can revive the brand’s growth trajectory.
Key Takeaways
- Rad Power Bikes sold for $13.2 million to Life EV, a significant drop from its $1.65 billion peak.
- The auction concluded on January 22, with a total value of $14.9 million after liabilities.
- The deal follows a period of layoffs, executive changes, and battery-fire safety concerns.
- Life EV plans to integrate Rad Power’s assets, but the transaction awaits judicial approval.
- The sale reflects wider instability in the micromobility sector, with peers like VanMoof, Cake, and Bird also having faced bankruptcy.
