* Better Place raised $850 million, once valued at $2.25 bln
* Sluggish sales led to company's failure
* Company unsuccessful in final round of fundraising
By Ari Rabinovitch
JERUSALEM, May 26 Electric car company Better
Place said on Sunday it had filed a motion in an Israeli court
to wind up the company, bringing an end to a venture whose
battery charging network had aimed to boost electric car sales.
Better Place partnered with Renault in 2008 to
create an electric car system combining charging terminals with
battery swap stations to increase the range of electric cars and
put an end to drivers' worries about running out of power.
It raised more than $850 million from top-tier investors and
just two years ago said it was valued at $2.25 billion.
But sales never took off, with only just over a thousand
cars on the road in Israel and Denmark, the first two countries
where it began operating.
"The (gasoline-free) vision is still valid and important and
we remain hopeful that eventually the vision will be realized
for the benefit of a better world," the company's board of
directors said in a statement.
"However, Better Place will not be able to take part in the
realization of this vision."
Carmakers have invested heavily in electric cars, but
awareness is growing that hybrid and battery cars may not be
enough to win the race to meeting rigid EU carbon dioxide
"This is a difficult day for all of us," said Chief
Executive Officer Dan Cohen.
"Unfortunately, after a year's commercial operation, it was
clear to us that despite many satisfied customers, the wider
public take up would not be sufficient," he said in a statement.
The company management, he said, requested the appointment
of a voluntary liquidator who would decide on how to award
compensation to customers and staff and maintain the network
already in place.
MUCH FANFARE, FEW SALES
Sunday's announcement came as no surprise.
With its partner Renault, Better Place committed to a
production run of 100,000 electric cars for Israel and Denmark,
counting on large fleets to sign up.
At the same time it developed plans to expand into Australia
and then onto markets like China and the United States.
But the large-scale deals never materialized. Only about 900
of its cars are on the road in Israel, and about 400 in Denmark.
Renault could not immediately be reached for comment.
A November earnings report published by conglomerate Israel
Corp, which owns about 30 percent of Better Place,
said the company had an accumulated deficit of $561.5 million
with more losses expected.
The company made changes and reduced its workforce. Founder
Shai Agassi was removed as CEO in October, and his successor was
replaced just four months later.
Alan Gelman, chief financial officer and head of operations
in Israel, told Reuters at the time that the company knew why it
was floundering and was trying to turn a corner.
"We at times were too focused on turning into a global
company and expanded too fast, but we have to focus on local
operations and selling cars," he said.
After a failed final round of fundraising, Better Place
turned to the Tel Aviv area court.
"Revenues are still insufficient to cover operating costs,
and in the light of the continued negative cash flow position,
the board has decided that it has no option but to seek to make
this application to the courts for an orderly liquidation of the
company," it said in a statement.
Israel Corp, the largest shareholder in Better Place, said
in a statement to the Tel Aviv Stock Exchange on Sunday it had
decided not to inject more cash into the beleaguered company.
Other shareholders include HSBC, GE and