Lion unveiled the Lion8 Tractor at the Advanced Clean Transportation Expo in May 2024. (Lion Electric)

An investor group involving Montreal real estate tycoon Vincent Chiara is set to take control of bankrupt Lion Electric Co., offering new capital to keep the electric bus and truck maker alive.

The Saint-Jerome, Quebec-based company filed for creditor protection in December after it failed to repay some debts and couldn’t find a buyer for the business or its assets. When the Quebec government declined to invest more money, the company’s appeared headed for liquidation.

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But Chiara and other investors have made a new offer, which must be approved by the court. Under their plan, Lion would focus exclusively on building electric school buses at its plant in Saint-Jerome.

The firm has already shut down its bus manufacturing plant in Joliet, Ill., as well as a battery pack assembly plant in Mirabel, Quebec.

The Quebec government has committed to renew a provincial program that gives substantial incentives to buyers of electric school buses, according to a personal familiar with the matter. Lion is the country’s sole manufacturer of such vehicles.

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Lion surged during the electric vehicle boom, but suffered from delays in subsidy and incentive programs in Canada and the U.S., supply chain disruptions and challenges with scaling up the business to profitability.

As part of its bankruptcy filing, Lion disclosed that it owed more than $244 million to secured and nonsecured creditors, according to its court-appointed monitor. National Bank of Canada and Caisse de Depot et Placement du Quebec are among them.