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Battery Maker A123 Hires Adviser for Strategic Review
A123 Systems Inc., a maker of lithium-ion batteries for electric vehicles says it has hired a financial adviser to find an investor for the company or explore other financial alternatives if no investor is found.
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A123 Systems Inc., a maker of lithium-ion batteries for electric vehicles says it has hired a financial adviser to find an investor for the company or explore other financial alternatives if no investor is found. The company says it is in talks with unidentified strategic investors.
Waltham, Mass.-based A123 also is trying to raise $50 million through a private debt offering that ends on Friday. In addition, the company wants to replace its credit line from Silicon Valley Bank, which recently hiked collateral requirements and set new limits on drawdowns.
A123's reputation and balance sheet were hurt in March when the company had to replace hundreds of defective batteries it supplied to Fisker Automotive Inc. for its Karma hybrid sedan. A123 also began a recall in December to replace batteries in the first 240 Karmas sold.
The battery maker says the $52 million recall expenses contributed to its $125 million net loss for the first quarter compared with $54 million in the same period of 2011. Revenue plunged 40% to $11 million.
Analysts say A123 has been subject to fluctuating orders from companies in the nascent market for electric and hybrid vehicles. Its customers include BMW, BAE. General Motors, Navistar and Shanghai Automotive.
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