RIP: Abound Solar
The DOE confirmed that Abound will be closing its doors and declaring bankruptcy next weekin a posting on its website today. The post noted, “Because of the strong protections we put in place for taxpayers, the Department has already protected more than 80 percent of the original loan amount. Once the bankruptcy liquidation is complete, the Department expects the total loss to the taxpayer to be between 10 and 15 percent of the original loan amount.”
Greentech Media has learned from reliable sources within the company that Abound Solar will be shutting its doors as soon as Thursday, after failing to find a buyer. Our source indicates that there will be an all-hands meeting at 11 a.m. on Thursday to break the news.
The firm was the beneficiary of a $400 million DOE loan guarantee, only $70 million of which has been drawn down. So, despite the imminent comparisons to Solyndra, this is bad news — but not quite on the scandalous scale of that solar module maker.
About a month ago at an all-hands company meeting, there was news of an unnamed prospective buyer which never materialized, according to our source, who added that “Abound will meet with the DOE tomorrow to finalize the terms of the shutdown. Then we will have the meeting, and non-essential staff will be let go at that time.”
In March, Abound went through layoffs and a production halt of its first-generation, 10.5-percent-efficient CdTe PV module in order to transition to building its next-generation, higher-efficiency module in a process that cost 180 full-time jobs. At that time, our sources indicated that there was roughly $7 million in the bank, a painfully short runway, and that vendors were being paid in a very selective manner.
The firm awaited $10 million from the DOE and $10 million from its investors, but had a bit of a chicken-and-egg problem. The DOE was waiting for the investors, and the investors were waiting for the DOE. Abound’s venture investors include DCM, Technology Partners, GLG Partners, Bohemian Companies, and Invus. DOE money is milestone-based and comes with very specific spending covenants.
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