Axion Power files for Chapter 7 bankruptcy

Axion Power files for Chapter 7 bankruptcy

Axion Power files for Chapter 7 bankruptcy 320 213 Batteries International

30 August 2018: Lead carbon battery maker Axion Power International filed for Chapter 7 bankruptcy on August 2 in the Bankruptcy Court for the Western District of Pennsylvania. In the US Chapter 7 bankruptcy involves the total liquidation of the company as opposed to Chapter 11 and 13, which refer to the process of reorganizing the company while bankrupt.

In the filing, CEO Richard Bogan said that over the past three years, the company had “made over 30 detailed, specific and concerted efforts to sell Axion’s IP, merge the company with another entity, establish a significant joint venture or monetize the value of Axion’s $70+ million NOL’s (net operating losses).

“All of the company’s directors tendered their resignations to be effective immediately upon this bankruptcy filing.”

The question now for the wider lead battery business is who will take up the intellectual property from the firm and whether this will continue to be developed.

One of the reasons for the failure of the company is the collapse of a business deal with the Chinese state-owned battery company Fengfan, despite several years’ work.

The company had been optimistic about the deal, announcing in July 2017 that it had reached an agreement with Fengfan to introduce the chemistry to China after Bogan made a trip to China the previous May.

Officials from the Chinese firm made a return trip in July, and batteries were handed over to Fengfan for testing and validation.

But it came to nothing.

“The company’s multi-year work with its potential partner in the People’s Republic of China — Fengfan Co Ltd, Baoding, China — has proven to be extremely disappointing,” the filing says.

The collapse of the company comes after Axion released a residential energy storage system in September, a solar energy system backed up with its lead carbon batteries.

In November, the company said it had deployed its batteries in two remote locations in North America, again to back up solar-generated power.

The lead carbon batteries were said to be a better fit for those locations, where low temperatures could cause havoc with other battery chemistries.

One industry insider told BESB that he believed management decisions over financing were the ultimate cause of the collapse.