A123Systems plans to raise up to $175 million through an initial public offering, the company said in regulatory filings Friday.
The company, which is developing batteries for plug-in hybrids and electric cars, didn’t list the number of shares it plans to offer or the price range in its filings with the U.S. Securities and Exchange Commission. A123 hopes to trade under the symbol “AONE” on the Nasdaq.
The Watertown, Mass., startup said earlier this year that it was planning an IPO. A123 has attracted plenty of attention in the last few years, starting in 2005, when it burst out of stealth mode with a $32 million venture round and a deal to provide lithium-ion batteries for Black & Decker power tools.
A123 raised an additional $30 million in 2006, and closed two rounds – of $40 million and $30 million – led by General Electric Commercial Finance in 2007, bringing its total capital to $132 million. A123 also acquired plug-in-hybrid conversion company Hymotion last year.
It has made a name for itself by lining up carmakers as research partners and customers.
Norwegian electric-car company Think Global in March announced a contract to buy batteries from A123 (see Think Global to Bring Electric Crossover to U.S.).
Last year, the battery maker said it would work with General Motors to develop new lithium-ion battery cells to power the Chevy Volt, a sporty plug-in hybrid car due out in 2010, and other GM vehicles (see Chevy Volt Cleared for 2010 Production).
A123 also has a deal to sell batteries to BAE Systems for its Hybridrive propulsion system, which Daimler is using for its Orion VII hybrid-electric buses.
The company has received plenty of attention for taking orders – and signing up dealers – for its Hymotion kits to convert Toyota Prius cars into plug-in hybrids (see Can Hymotion Convert the Auto Industry? and Toyota Dealers Sold on Hymotion Plug-In Hybrids). The kits allow owners to charge their vehicles at standard electrical outlets.
The battery market for hybrid-electric and all-electric cars generates about $700 million in annual sales worldwide, and is expected to increase to at least $5 billion in 2012, according to A123’s SEC filings.
A123, founded in 2001, entered the battery business at a time when battery technology had remained essentially unchanged for decades. Consumer demand for more powerful and long-lasting batteries for, say, laptop computers and cell phones, has prompted companies such as chipmaker Intel and Motorola to invest in battery companies.
A123 has won believers out of electric utilities.
The company is working with AES Energy Storage, part of Arlington, Va.-based power company AES Corp., to design battery systems for the grid. The multi-megawatt battery systems would help the grid meet demand, including when generator or transmission problems occur.
A123 also is working with General Electric to develop batteries to store power and help the grid meet peak demand (see A123 Batteries to Help Stabilize Electric Grid). General Electric has invested $20 million in A123Systems through several rounds of funding (see Think Global to Bring Electric Crossover to U.S.).
The global market for electric-grid batteries brought in $2.4 billion in sales in 2007, and the company expects the market to grow to $3.1 billion by 2015.
Sales to Black & Decker represented 82 percent of A123Systems' revenues in 2006 and 66 percent in 2007. The market for cordless power tools using lithium-ion batteries is expected to expand from $411 million in 2007 to $1.1 billion by 2012, the company said.
A123, with more than 1,100 employees, began selling its first commercial products in the first quarter of 2006.
It generated $41.3 million in revenue in 2007, up 20.4 percent from $34.3 million in 2006, the company said in its SEC filings. It brought in $10.3 million in revenue for the first quarter of this year, compared with $8.1 million from the same period last year.
The company posted a net loss of $31 million in 2007, a 96 percent jump from a net loss of $15.8 million in 2006. For the first quarter of this year, A123Systems reported a net loss of $13.91 million, compared with $4.59 million from the year-ago period.
The battery company makes its products in China, South Korea and Massachusetts. A123Systems plans to use part of the money raised through the IPO to expand its manufacturing centers.