A123 Hopes For Investment Deal As Losses Widen
Waltham-based battery maker A123 Systems, which has operations in MetroWest, reported today that its second-quarter revenue fell 53 percent to $17 million compared to the second quarter of last year.
Losses were $82.9 million compared to $55.4 million. The company announced that it has reached a non-binding memorandum of understanding (MOU) with Chinese auto parts maker Wanxiang Group Corp. that could infuse A123 with $450 million if the company meets certain conditions.
David Vieau, A123's CEO, said the deal represents a step "toward securing A123's financial stability."
Wanxiang is one of the largest non-government-owned companies in China.
The company's CEO, Weiding Lu, said in a statement that A123 would create synergies with Wanxiang's business.
"This MOU is the first step toward a longer-term agreement through which we plan to build on the foundation A123 has established in the U.S. and help expand the company's capabilities both domestically and internationally," Lu said.
A123 makes lithium-ion batteries and energy storage systems for electric vehicles and electric grid operators, among other industries.
Its second-quarter losses included $11.3 million in charges related to a change in the fair value of warrants and embedded derivatives and an additional write down of the company's investment in Fisker Automotive. A123 had $47.7 million in cash at the end of the quarter, compared to $294.9 million a year ago.
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