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Electric van leasing company EVCo, facing debts nearing $50 million, has been declared insolvent, meaning it cannot pay back its debts.

The majority is owned by SMRT's business arm, Strides Holdings, and with a 40% stake held by a Hong Kong-based company, EVCo was formed in March 2022 with a modest capital of $10 million.

However, the company's fortunes took a downturn after its former CEO and CFO were arrested during a police investigation in late 2023, leading to its provisional liquidation.

Baker Tilly, the appointed liquidator, disclosed that EVCo's remaining assets, including its fleet of electric vans, won't suffice to cover its debts.

These assets, particularly the China-made electric vans, have likely devalued substantially due to sliding certificate of entitlement prices, compounded by battery degradation from prolonged disuse.

How The Electric Van Leasing Company Stacked Up Its Debts

A list of creditors obtained by The Straits Times revealed that as of Feb. 28, there were 28 creditors with a combined debt of $49.4 million. The largest amount is owed to OCBC Bank, totaling $47.6 million, followed by debts owed to SMRT and various Strides-related units. A meeting of creditors was held on Mar. 18.

But it's uncertain whether additional creditors have emerged since then.

EVCo's insolvency has sent shockwaves through its creditors, with one anonymous creditor attributing the company's downfall to poor management and the exploitation of loopholes.

Despite initial ambitious plans to expand its fleet to 2,000 electric vans for a vehicle-sharing program, the Electric van leasing company faced financial difficulties shortly after its establishment.

As of March 2023, the company registered 197 Chinese-made Shineray electric vans, making it the sole provider of this brand in Singapore. However, with only 218 Shineray vehicles registered in 2023, according to the Land Transport Authority, EVCo's plans to scale up its operations ultimately faced challenges.

However, it's worth noting that the Electric van leasing company is a private limited company, which means the shareholders are not personally liable for the company's debts beyond the amount of capital they invested in the company.

SMRT confirmed that EVCo voluntarily chose to go into liquidation, and an independent liquidator has been appointed to oversee the process.

For now, attempts to reach the chairwoman of Strides-DST, Judy Lee, for comment were unsuccessful.

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Electric vehicles