A123 Rises After Saying It Will Weigh Strategic Options

A123 Systems Inc. (AONE), a U.S. maker of lithium-ion batteries for electric cars, rose the most in almost two weeks after hiring an adviser to evaluate strategic alternatives for the company.

A123, based in Waltham, Massachusetts, climbed 5.4 percent to 96 cents at the close in New York, the most since May 2.

A123 has “retained an outside adviser to provide financial strategic advisory services in connection with our ongoing strategic efforts and evaluation of strategic alternatives,” David Vieau, A123’s chief executive officer, said today during a conference call with analysts.

The company reported today a net loss of 87 cents a share, 50 cents greater than the average of 7 estimates compiled by Bloomberg. It expects 2012 sales to range from $145 million to $175 million, compared with an earlier forecast of $230 million to $300 million.

“Saying that they’re willing to look at all options may give investors something different to think about,” Amir Rozwadowski, an analyst at Barclays Plc in New York, said today in an interview. “The announcement may be shifting the conversation to ’what is the inherent value of this company’s assets?’”

Fisker Automotive Inc. and Bayerische Motoren Werke AG (BMW) use A123 batteries in electric cars. A123’s shares fell 39 percent through yesterday since it recalled on March 26 batteries that made a Fisker car shut down in a Consumer Reports test.

One of A123’s challenges is that its customers are developing an emerging product and some of the buyers are startups, Rozwadowski said. That makes it difficult to forecast project end market demand and drive costs lower, he added.

“When you have a mismatch between demand and capacity, you have challenges,” Rozwadowski said.

To contact the reporter on this story: Ehren Goossens in New York at egoossens1@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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