Troubled US battery maker A123 Systems, which successfully floated in 2009, has secured a $450 million investment from Chinese carmaker Wanxiang Group Corporation.
Despite its early promise securing a number of high-profile deals for its lithium-ion battery technology with vehicle manufacturers, A123 Systems has struggled financially in recent times.
But while A123 is likely to post losses of over in the second quarter $82 million this year compared with $55 million over the same period last year, Wanxiang is one of China’s largest carmakers boasting $13 billion in revenue and 45,000 employees worldwide.
Initially, Wanxiang will offer $75 million in debt financing with a credit extension totalling $25 million and the option of another $50 million if certain conditions are met. A further $200 million will acquire A123’s existing senior secured debt with the option of another $175 million for warrants on debt financing.
“[The] announcement is the first step toward solidifying a strategic agreement that we believe would remove the uncertainty regarding A123’s financial situation,” says A123’s CEO David Vieau. “A substantial capital investment from Wanxiang would not only provide financial stability to A123 as we continue to grow, but it would also align us with a large, successful global brand in the automotive and cleantech industries.”
Meanwhile, fellow US lithium-ion battery maker Boston-Power has signed a multi-year deal to provide its battery systems to Beijing Electric Vehicle Company, which is part of Beijing Automotive Industry Company.
Initially, Boston-Power will provide batteries for various electric vehicle models – including the C70 sedan, which is based on the 9-5 SAAB chassis acquired by Beijing Electric Vehicle Company in 2009.
Boston-Power is also building a research and development and electric vehicle battery engineering facility in China to backup its efforts.
Fisker chooses A123Systems over Ener1 as battery supplier (19-Jan 2010)
US makes largest single investment in battery technology (7-Aug 2009)
Chrysler partners with A123Systems on electric vehicle batteries (9-Apr 2009)
Article source: http://www.energyefficiencynews.com/i/5325/