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Plextronics Shorts Out

Bankruptcy: Solvay offers to buy maker of conductive polymers for electronics

by Marc S. Reisch
January 27, 2014 | A version of this story appeared in Volume 92, Issue 4

Credit: Plextronics
A flexible OLED panel made with Plextronics conductive inks.
OLED panel made with Plextronics conductive inks.
Credit: Plextronics
A flexible OLED panel made with Plextronics conductive inks.

Succumbing to slow development of the market for printed and flexible circuitry, the electronics materials maker Plextronics has filed for bankruptcy reorganization.

Solvay, a Belgian company that owns 47% of Plextronics and makes other materials for electronics, offered $32.6 million for the ailing firm. The bid is subject to an auction and final sale by the end of March under supervision of the U.S. Bankruptcy Court for the District of Delaware.

Founded in 2002, Plextronics is a spin-off from Carnegie Mellon University, where then-chemistry professor Richard D. McCullough developed conductive organic polymers useful for printed electronics. The firm had hoped to profit on the enthusiasm for the polymers after Alan G. MacDiarmid, Alan J. Heeger, and Hideki Shirakawa won the 2000 Nobel Prize in Chemistry for their conductive polymer work.

Solvay got on board in 2007 and has since invested $37 million in Plextronics. Another investor is Universal Display Corp., an organic light-emitting diode developer with which Plextronics has a research alliance.

According to court documents, however, Plextronics never turned a profit and only generated “modest” revenues. The firm’s goal was to become a leader in developing conductive inks and polymers for flexible solar cells, lighting, and transistors, but demand has been slow to materialize.

In 2010, Solvay’s board rejected a Plextronics proposal that it acquire the struggling firm. As recently as October 2013, Plextronics tried to raise $5 million in an effort to keep going, according to documents filed with the Securities & Exchange Commission. The bankruptcy and sale represent “the best possible solution for Plextronics,” says McCullough, who is also chairman of the Pittsburgh-based firm.

Like the 2012 bankruptcy of Konarka Technologies, a developer of flexible organic photovoltaic films, the fall of Plextronics is a “sign that not all companies can withstand the competition in the electronics space,” says Harry Zervos, an analyst with consulting firm IDTechEx.

But Zervos notes that should Solvay succeed in buying Plextronics, its hand will be strengthened against rival electronic materials developers such as BASF and Merck KGaA.



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