Energy Conversion Devices files for bankruptcy as solar energy lags

[WestVirginiaRebel]

Detroit Free Press:

In the latest setback for the solar energy industry, Auburn Hills-based Energy Conversion Devices said today that it has filed for Chapter 11 bankruptcy and intends to sell its assets, including its main subsidiary United Solar Ovonic.

 

“We firmly believe there is a strong and sustainable commercial market for Uni-Solar products,” Julian Hawkins, ECD’s CEO and president, said in a statement. “However our current capital structure and legacy costs are preventing USO from making the investments necessary for the future of the business without restructuring through the bankruptcy process.”

The maker of solar roofing materials, which will continue to operate, employs 750 workers, 60% of them in Michigan. They will remain active employees during the sales process though some have been furloughed, said company spokesman Michael Schostak.

ECD also said it has sold its Ovonic Battery Co. to BASF Corp. for $58 million in cash before transaction fees and other factors. The battery subsidiary’s 35 employees have been hired by BASF.

ECD has retained the investment banking firm Quarton Partners to manage the sale of its assets, which is expected to be completed in 90 days. It has $145 million in cash and short-term investments to enable it to operate through the bankruptcy proceedings and will not need debtor-in-possession financing.

The bankruptcy follows an unsuccessful effort by ECD to find additional capital. In November, the money-losing company suspended manufacturing to cope with high inventory levels and announced the layoffs of 500 employees. Its sales have suffered from cutbacks in solar energy incentives in Europe and a worldwide glut of solar panels. Analysts also said the company’s technology was no longer competitive.

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That seems to be happening quite a bit lately...