Friday, September 9, 2011

A not-so-sunny outlook ahead...

In better times: Talking-up Solyndra...

An FBI raid yesterday on Bay Area-based Solyndra Inc., a solar-panel maker that failed after receiving a $535 million loan guarantee from the U.S. Department of Energy. According to sources, this is just the beginning of an multi-level investigation that will look into the Obama administration’s clean-energy program, how Obama donors might have benefited from their ties to the company and the administration, and how Stimulus money was used and/or diverted.

In addition, there is a dispute over what the company’s CEO told members of Congress about the strength and viability of Solyndra.

According to a Bloomberg News report: “Democratic Representatives Henry Waxman of California and Diana DeGette of Colorado said yesterday that Solyndra Chief Executive Officer Brian Harrison assured them in a meeting less than two months ago that the company was in a ‘strong financial position. He did not convey to us the perilous condition of the company, and the committee should know why,’ Waxman and DeGette wrote in a letter yesterday to Stearns. 'At that time, he said the company was projected to double its revenues in 2011, there was ‘strong demand in the United States’ for its shipments, and the company was expected to double the megawatts of panel production shipped this year,” according to the letter. ‘These assurances appear to contrast starkly with his company’s decision to file for bankruptcy.’”

The DOE gave Solyndra the most federal backing awarded a solar manufacturer. The George Kaiser Family Foundation, a charitable organization based in Tulsa, OK, and backed by donations from billionaire Obama fundraiser George Kaiser, holds almost 39 percent of Solyndra, according to a company filing with the Securities and Exchange Commission.Kaiser raised, or bundled, $50,000 to $100,000 for Obama’s 2008 campaign, according to a list that had been posted on Obama’s 2008 campaign website. He gave $2,300 personally, according to the Federal Election Commission.

In the week before the administration awarded Solyndra with the first-ever alternative energy loan guarantee on March 20, four separate visits were logged. Kaiser, who has in the past been labeled a major Solyndra investor as well as a Obama donor, made three visits to the White House on March 12, 2009, and one on March 13. Kaiser has denied any direct involvement in the Solyndra deal and through a statement from his foundation said he “did not participate in any discussions with the U.S. government regarding the loan.”

White House visitor logs show that Kaiser had 16 meetings with Obama aides, 11 of them in 2009. His first recorded visit to the White House was March 12, 2009, when he met separately with Austan Goolsbee, a senior economic adviser to Obama, Pete Rouse, a senior adviser to the president, and Heather Higginbottom, deputy director of the Domestic Policy Council. The next day he met with Jason Furman, a member of Obama’s National Economic Council.

That month, the Energy Department awarded Solyndra the $535 million loan guarantee to commercialize its cylindrical solar panels.In June, Kaiser met with senior Obama adviser Valerie Jarrett, policy adviser David Pope and then-Chief of Staff Rahm Emanuel. His most recent meeting covered by the White House logs was on April 11 of this year, with Rouse.

Obama supporter/fundraiser/Oklahoma billionaire George Kaiser...

Kaiser’s firm, Argonaut Ventures and its affiliates have been the single largest shareholder of Solyndra, according to SEC filings and other records. Under terms of the bankruptcy filing, investors including Argonaut -- which led a $75 million round of financing for Solyndra earlier this year -- will stand in line before the federal government and other creditors to recoup its losses. Energy officials confirmed this arrangement, saying that after private investors including Kaiser recover $75 million, the U.S. government would have a chance to seek $150 million of its investment.

Agents for DOE Inspector General Gregory Friedman, who has called the department’s clean-energy loan program lacking in “transparency and accountability,” joined in the search yesterday at the Fremont, California, headquarters of Solyndra, which filed for bankruptcy protection on Sept. 6.

The company borrowed $527.8 million from the U.S. Federal Financing Bank, a unit of the U.S. Treasury Department that’s its biggest lender. In January, the Energy Department agreed to let $385 million in taxpayer support for Solyndra take a back seat to funds from new investors in an effort to keep the company operating.

Folks -- this is just the beginning of this story.

(Huge h/t: Jim Snyder reporting for Bloomberg -- for much of this report)

1 comment:

Cali Tatum said...

This is why poor companies with poor business models should die. So that good companies with a good business model will thrive and get stronger. One very excellent belief of true capitalism. No hand outs, just good business saves the economy every single time. Poor business and funds, bailouts not based on a good business model kills everyone involved and peripheral entities as well.