Viewing posts tagged "A123"

After Steep Rise, A123 Systems’ Stock Heading Back Toward IPO Price

Nearly two months after its successful initial public offering, A123 Systems seems headed back to its roots.

The company's stock has traded at around $15 today and has dipped into the high $14 range. (I noticed this after getting a stock quote for a report that Tesla may file for an IPO.) A123 went out at $13.50.

Stocks are currently being whacked, so it's natural that the battery maker would take a hit. Still, it's been a wild two months. The company's stock climbed to nearly $20 on the first day of trading, a 45 percent increase. A little while later, it climbed past $28 and stayed in the $20 plus range through most of October.

But November has brought a spate of bad news and a gradual slide downward. First, Fiat announced it had revamped and trimmed back Chrysler's electric car plans. Chrysler had picked A123 to make its batteries. A week later, A123, in its most recent quarterly report, posted a $22.9 million loss but an increase in revenue. On the plus side, the company completed a utility energy storage project in Chile.

Tesla Prepping for IPO, Speculates Reuters

Tesla Motors is preparing to move forward with an IPO, according to unidentified sources at Reuters.

There is no S-1 on file right now, according to the SEC's website, but that would be the first step.

Many have waited for Tesla to start moving on an IPO. It is one of the most visible green companies and, with its loan from the government, will likely be able to fulfill its ambitions of bringing out a sedan in a few years.

The A123 Systems IPO likely had an effect as well. A123's stock zoomed up the first day of trading and sparked hopes that more would follow. (A number of people, in fact, sent Musk news articles on the A123 IPO the day it occurred, I'm told.)

Of course, not everything goes as planned. Although A123 nearly hit $20 on the first day of trading, it is now wallowing around $15. The company went out at $13.50.

Electrification Coalition: U.S. Needs One-Quarter EVs, PHEVs by 2020

A coalition of automakers, smart grid, shipping and energy companies has set out an ambitious goal for an American electric transportation revolution – make one-quarter of the United States' light vehicles "grid-enabled" electrics and plug-in hybrids by 2020.

Without reaching that tipping point, the Electrification Coalition's goal of boosting the number of electric light vehicles from 1.3 million today to more than 250 million by 2040 – and cutting the country's oil dependency by about 75 percent in the bargain – will be hard to reach.

Simply put, that's because it will take a critical mass of plug-in vehicles to make the infrastructure for charging them worth building, coalition members said in a Monday press conference (see Electric Vehicles Could Surpass Grid or Support It).

To get there, the coalition is asking the government to target "electricity ecosystems," or large cities where local infastructure could be built to support from 50,000 to 100,000 electric vehicles by 2013, Reuters reported.

To boost that, the coalition is asking the federal government to offer tax credits of up to 75 percent of the cost of that public infrastructure to support a charging network. It would also like consumers to have access to those tax credits for home charging equipment (see Green Car Congress).

The coalition also wants tax credits to cover up to half the cost of IT upgrades for utilities to manage charging networks that can sell and buy power to grid-enabled vehicles (see IBM Tests Smart Charging in Denmark and A V2G Test: Pool Electric Cars for Grid Needs).

Members of the coalition include Nissan Motor Co. (see Green Light post), Pacific Gas & Electric, NRG Energy, Kleiner Perkins Caufield & Byers, Coulomb Technologies (see Green Light post), FedEx Corp, Coda Automotive, Bright Automotive, A123 Systems and GridPoint (see Green Light post).

Fiat and Chrysler Pull Back on Electric Cars; Bad News for A123 Systems?

Fiat, the new owners of Chrysler, has apparently pushed back the effort to release an electric car, according to Reuters. Fiat has scrapped the Dodge Circuit, a two-seater electric sports car, as well as a plan to make a fleet of 220 electric and hybrid cars. The Department of Energy gave the company $70 million in grants in August to develop that fleet. Not sure if we get the money back.

The Envi electric car group has been absorbed into the regular car making group, Reuters said.

That could be bad news for battery-maker A123 Systems. A123 lost the deal to supply batteries to General Motors for the Volt earlier this year (although the two companies publicly vowed to remain friends). The Chrysler deal in April helped A123 rebound. The battery maker subsequently pulled off a successful IPO.

Will the changes at Fiat/Chrysler hurt? It's hard to say, but it's not great news. On one hand, Fiat and Chrysler still plan to come out with electric cars. Lou Rhodes, who headed up Envi, will head up electric car development for Fiat and Chrysler.

On the other hand, it sounds like electric cars are going to come out of the combined company later and at a slower pace. Chrysler earlier said it wanted to have an electric car out by 2010. On Friday, Fiat CEO Sergio "Marchionne told reporters and analysts electric cars would only represent "one to two percent" of Chrysler's sales by 2014, equivalent to less than 60,000 vehicles," Reuters wrote. The company is considering a delivery van in the U.S. Will they put some out in 2010 or will it be later? Hopefully more clarity comes next week.

"Until the [battery] storage gets resolved, I think electric vehicles are going to struggle," Marchionne was quoted as saying.

A Month Later, A123 Systems Still Rising

If you were wondering if the stock of battery maker A123 Systems would hold up after its successful IPO last month, the answer is good.

The stock closed at $23.89 today. The company went public on September 23 for $13.50 a share. (A123 initially was going to sell its stock in the $8 and $9 range but upped it a couple of times right before the IPO.

On the first day of trading on Sept. 24, it rose to $20.18. 

The company specializes in lithium-ion batteries for power tools and cars. It has contracts with BAE Systems and Chrysler. But timing helped too. The stock market has been rising and everyone has been antsy for an IPO. Even though the company has never made a profit and has lost $146 million since it began in 2001, investors flocked to it. Revenues have been climbing.

It wanted to go public last year but pulled the IPO amid the financial turmoil.

A123 Explodes in First Day Trading, Near $20 a Share

A123 Systems is zooming in the first day of trading. The company yesterday sold 28.1 million shares for $13.50 each to raise $380 million.

The stock is currently trading at $19.65 and briefly touched 20. Right now, that's a 45 percent gain.

Not bad for a company that's never turned a profit!

The gains are even more remarkable when you consider that it upped its IPO price twice right before trading and increased the number of shares for sale. Right before the IPO, it had anticipated selling 25.7 million shares for between $10 and $11.50 each. Earlier, A123 said the company would likely select a stock price was between $8 and $9.50.

Optimists say that this could be a wellspring for future clean IPOs, but it has skeptics too. The company mostly makes batteries for power tools but has branched into some experiments in smart grid. It will make batteries for the automotive market – for Chrysler. Here's a summary of info from the S-1.

Is it sustainable? It's hard to say. On one hand, we are living through the golden age of batteries. Five years ago, few people cared that much about them. Now, the federal government is lavishing grants on battery makers and utilities and car makers both say they plan to incorporate lithium-ion batteries into their operations and products. A123 is ahead of many of the startups and already ships batteries to customers. The company emerged from MIT in 2001. It also has friends at General Electric and BAE Systems.

On the other hand, a lot of well-established giants in Asia make these already. Can a startup make headway? Plus, we've lived through IPO fever before. Remember Larry Augustin? Probably not. But he was a billionaire on paper for about ten minutes after VA Linux went public.