Battery maker files for Chapter 11 bankruptcy reorganization

An advanced battery maker with Las Vegas-area operations filed for Chapter 11 bankruptcy reorganization on Thursday.

The filing was made by Valence Technology Inc. of Austin, Texas, which has about 10 Las Vegas-area employees in its legal and engineering operations.

Valence, which has publicly traded stock, says it’s a global leader in the development and manufacturing of long-life lithium iron magnesium phosphate batteries and systems.

Its batteries are used for applications like buses, yachts, tug boats, robotics, floor cleaners, forklifts, defibrillators and wheelchairs.

The company said in Thursday’s bankruptcy filing in Austin that it’s hoping to restructure some $83 million in debt and that the bankruptcy filing was necessary because of continued operating losses and its inability to arrange new financing in the form of equity or debt.

The company, with some $44 million in annual revenue, has just $32 million in assets.

In a statement Friday, Valence said it is negotiating a debtor-in-possession credit facility that is expected to provide liquidity for Valence to operate its business during the Chapter 11 proceedings “and to continue the flow of goods and services to its customers in the ordinary course.”

“Our goal is to continue to operate and meet customer requirements as we work through the Chapter 11 process as quickly as possible. We are fully committed to working with our valued customers,” CEO Robert Kanode said in a statement.

Thursday’s bankruptcy filing followed disputes among members of the Valence board of directors that caused two directors to resign in recent weeks.

Valence shares a common heritage with fellow advanced battery maker K2 Energy Solutions Inc. of Henderson.

Valence moved its headquarters from San Jose, Calif., to Henderson in 1995 because of the lower costs to do business in Nevada. At the time, it was working on electric car technology research with the Delphi Automotive Systems Group of General Motors Corp.

By 2001, Valence’s headquarters had moved to Austin because that’s where a new CEO lived. K2, in the meantime, was formed in 2006 by some battery scientists and executives — including some from Valence — who wanted to own their own company.

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