Seagate Technology in deal to buy Solyndra plant: source

Reuters News
Posted: Aug 21, 2012 7:23 PM
Seagate Technology in deal to buy Solyndra plant: source

By Ilaina Jonas

NEW YORK (Reuters) - Seagate Technology Plc <STX.O>, maker of hard drives and storage devices, has reached an agreement to buy the former manufacturing plant and headquarters building of bankrupt Solyndra LLC, which was financed by a controversial government loan, a source familiar with the deal said.

The price for the Fremont, California, building could not be determined. Tim Gallen, who represents Jones Lang LaSalle Inc <JLL.N>, which marketed the property, declined comment.

Seagate, based in Cupertino, California, could not be reached for immediate comment.

The U.S. bankruptcy court in Delaware in February approved the appointment of Chicago-based Jones Lang LaSalle to market the building, which cost more than $300 million and was completed in 2010, according to court documents.

At that time, the property was expected to fetch around $150 million. A final sale is subject to due diligence and the approval of the bankruptcy court.

Solyndra, which manufactured cylindrical solar panels, rose to fame after President Barack Obama visited it in 2010, as part of the administration's efforts to promote jobs in renewable energy. Solyndra had received a $535 million federal loan guarantee to build a factory in Fremont.

Solyndra's bankruptcy has been politically embarrassing for the administration as Republican lawmakers jumped on it as an example of failed energy policy and government waste leading up to the 2012 presidential election.

Solyndra's facilities could benefit a company that needs an ultra-clean environment such as makers of semiconductors or disc drives.

The building, located on 30 acres in the southeast section of the San Francisco Bay Area, comes with 31,000 square feet, or two floors, of office space.

The high-tech manufacturing facility was built to withstand an earthquake. It is serviced with 22 megawatts of power and backed up by two diesel emergency generators, each with 2 megawatt capacity. It also is equipped with Solyndra solar panels on the roof that can generate 1.2 megawatts of power.

The property includes plans to expand the facility by more than 200,000 square feet.

The bankruptcy case is In re Solyndra LLC, U.S. Bankruptcy Court, District of Delaware, No. 11-12799.

(Reporting By Ilaina Jonas; Editing by Bob Burgdorfer)