Through the licensing deal, IHI will develop battery systems for electric passenger and commercial vehicles in Japan using A123 technology. The company will also be the exclusive provider of A123’s battery systems in the country’s transportation market.
In addition, IHI agreed to make a $25 million equity investment in the Massachusetts-based firm. Both companies already had a marketing agreement to sell batteries to IHI’s customers in 2009.
A123 has struggled ever since it was described as the largest initial public offering of 2009. Its shares closed at $20.29 on opening day. But A123’s shares have been trading at the $3 to $4 range in recent months. The company was trading at $3.25 a piece yesterday on Nasdaq, up 8 cents a day earlier.
Last Friday, A123 lowered its 2011 revenue estimates between $165 to $180 million from a previous $210 to $225 million because of an unexpected cut in battery orders from Fisker Automotive, the California-based electric car startup. – Oliver M. Bayani