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Battery Maker A123 IPO Raises $380 Million

A123 (select to view enlarged photo)

SEE ALSO:: Eletric Vehicles NOW Being Served

NEW YORK, Sept 23, 2009; Phil Wahba writing for Reuters eportede that Lithium-ion car battery maker A123 Systems Inc (AONE.O) increased the number of shares in its initial public offering and priced them for $13.50 apiece, above the estimate range.

The upsized deal helped the Massachusetts company raise $380.4 million, far above what it had expected. On Tuesday, facing strong demand, A123 had raised the price estimate range of the IPO to between $10 and $11.50 apiece, up from the original range of $8 to $9.50.

A123 sold 28.1 million shares, 9.3 percent more than expected.

A123 shares are set to begin trading on Thursday on Nasdaq under the symbol "AONE."

A123, which was founded by scientists linked to the Massachusetts Institute of Technology, develops batteries and battery systems for hybrid electric vehicles, plug-in hybrid electric vehicles, and electric vehicles and works with such carmakers as BMW, Chrysler and General Motors Co.

"The fact that they have received several hundred million dollars from the government and have strong venture backers and corporate partners like Motorola and Qualcomm clearly reveals the confidence in this intriguing cleantech story," said Scott Sweet, senior managing partner with advisory firm IPO Boutique.

A123 won a $249.1 million grant in August from the U.S. Department of Energy as part of a competition for $1.5 billion in federal stimulus funds for companies that make advanced automotive batteries.

The IPO's underwriters, led by Goldman Sachs and Morgan Stanley, have the option to buy another 4.2 million shares which could bring the deal's total proceeds to $437.5 million.

Editing for Reuters by Richard Chang, Gary Hill