Ener1 Files chapter 11 after getting $118 million handout from the Obama administration

Parent of Obama-backed battery maker goes bankrupt
By MATTHEW DALY Associated Press
Posted: 01/26/2012 07:49:34 PM PST
Excerpts
WASHINGTON—The parent company of an electric car battery maker that received a $118 million grant from the Obama administration filed for Chapter 11 bankruptcy protection on Thursday.
New York-based Ener1 said it has been affected by competition from China and other countries.

Ener1 subsidiary EnerDel received a $118 million stimulus grant from the Energy Department in 2009, and Vice President Joe Biden visited the company's new battery plant in Indiana last year.

Ener1 is the third company to seek bankruptcy protection after receiving assistance from the Energy Department under the economic stimulus law. California solar panel maker Solyndra Inc. and Beacon Power, a Massachusetts energy-storage firm, declared bankruptcy last year. Solyndra received a $528 million federal loan, while Beacon Power got a $43 million loan guarantee.

The chairman of a House subcommittee that is investigating Solyndra said the latest bankruptcy showed that the
administration's clean energy program has failed.
"Unfortunately, you can now add Ener1 to the growing list of failed companies that went belly up after hundreds of millions of dollars in administration backing," said Rep. Cliff Stearns, R-Fla.
"One bankruptcy may be a fluke, two could be coincidence, but three is a trend," Stearns said. "Our investigation continues, and we are working to ensure taxpayers are never again stuck paying hundreds of millions of dollars because of the administration's risky bets."
An Energy Department spokeswoman said EnerDel had received $55 million so far under a program in which EnerDel matches federal investment dollar-for-dollar .More from The Marin Independent Journal


Biden, during a visit to Ener1′s Indianapolis factory, said “Enron1 [is] leading the way” in battery technology, apparently confusing the company’s name with the notorious energy firm that filed for bankruptcy in 2001. The stimulus, Biden said, was “not just creating new jobs, but sparking whole new industries that will ensure our competitiveness for decades to come — industries like electric vehicle manufacturing.” More from The Foundry ~ SCRIBE Bluey Reports

Press release

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NEW YORK (January 26, 2012)
ENER1, INC. REACHES AGREEMENT WITH PRIMARY INVESTORS AND LENDERS
ON PLAN TO REDUCE DEBT AND SECURE NEW EQUITY FUNDING TO SUPPORT ITS LONG-TERM BUSINESS STRATEGY
Receives Commitments for up to $81 Million to Recapitalize Company for Continued Operations
Initiates Pre-Packaged Chapter 11 Proceedings to Implement Restructuring

the Company has voluntarily initiated a “pre-packaged” Chapter 11 case in U.S. Bankruptcy Court in the Southern District of New York, in which it is requesting that the Court confirm a pre-packaged Plan of Reorganization to implement the restructuring.

Link here to read full Press release