Friday, Feb. 01 2013 8:48AM
Exergonix still hunting for loans
Company missed announced dates, still has several years in city agreement
By Russ Pulley
Exergonix, a Lee’s Summit startup which proposed a local plant to manufacture high-capacity industrial batteries twice has missed announced dates for starting construction.
Don Nissanka, president and CEO, said in 2012 he expected to have a fall ground breaking.
In November 2012, at a Lee’s Summit Economic Development Council luncheon, Nissanka said the company was close to obtaining financing but an agreement was not settled. He predicted a start in “perhaps” January for a facility located on property which formerly was the Pfizer plant, near U.S. 50 and Missouri 291 highways.
Nissanka did not reply to requests for comments.
Jon Plaas, a member of Show Me Angels, an investment group which helped gather early backers of the venture from this area, said Nissanka has been working hard to put together money to build the plant.
Plaas said as an investor, not a spokesman for the company, he is aware Exergonix is still trying to raise funds.
He said current economic conditions have made it difficult for many companies to get venture capital.
“It’s probably been as bad as it’s been for 20 or 30 years,” Plaas said. “It’s the struggle all start ups have that need significant capital for buildings and equipment.”
He said there is “money out there chasing good things” but also it is coming with issues such as a desire to wrest control from founders and entrepreneurs.
Plaas said he is hopeful for the longer-range prospects of Exergonix obtaining financing because there are signs of a better economy. The stock market is moving up and investors are tiring of low returns on investments like Treasury notes, he said.
“People are starting to search for yields, you’ll see more money in venture capital,” Plaas said.
The city loaned Exergonix $1.5 million to purchase about 84 acres. The company planned a $40 million office complex and $50 million assembly plant, city officials said. The plant would manufacture industrial, high-capacity batteries suitable for storing electricity from wind and solar sources or for backup power for institutions like hospitals, as an alternative to generators.
Exergonix is in its second year of a five-year window to get the project off the ground.
If it fails, the city has the first option to buy the land for $100.
Mayor Randy Rhoads said if the company doesn’t build on land the city purchased for the project, then city still has made a good investment because the land was purchased at a good price.