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China BAK Won't Be Supplying Google Nexus One Battery

China BAK Batteries, a China-based lithium ion battery maker, had seen a surge of 63 percent in its share price last Tuesday due to the speculation that Google had contacted the company to manufacture and supply batteries for the much awaited Nexus One smartphone.

However, the shares of the company fell substantially when the company denied the existence of such a contract between them and Google. The China BAK Battery stock fell by 22 percent to $2.83 after seeing an initial surge of almost 63 percent in its stock price.

According to financial reports filed by the Chinese company in the past, it had been struggling with losses since its first year of operation and had announced last month that it will try to break even in 2010, leading some analysts to believe that the company may be become profitable in near future.

The company manufactures and supplies lithium batteries for mobile phones, laptops and other portable devices apart from supplying batteries to some domestic Chinese original equipment manufacturers for mobile phones.

China Bak's Chief Financial Officer, Tony Shen, told Bloomberg that "On the mobile phone side, the majority of business and historical business has been in the replacement battery business."

Our Comments

Someone should try to find out the source of the rumour as quite a few people have possibly been trading China BAK shares in the build up before the shares fell heavily. The Nexus One battery will be a removable one, a positive point compared to the iPhone's non removable battery.

Related Links

China BAK Battery Drops Premarket After Denying Google Pact (opens in new tab)

(Wall Street Journal)

China BAK Denies Winning Google Orders (opens in new tab)

(Barrons Blog)

China BAK Jumps 63% on Speculation It Won Google Deal (Update1) (opens in new tab)

(Business Weak)

Trading Tools to Build Your Portfolio: Option Players Charge China BAK Battery Inc. (opens in new tab)

(Scaheffers Research)

Désiré Athow
Contributor

Désiré has been musing and writing about technology during a career spanning four decades. He dabbled in website building and web hosting when DHTML and frames were en vogue and started writing about the impact of technology on society just before the start of the Y2K hysteria at the turn of the last millennium. Following an eight-year stint at ITProPortal.com where he discovered the joys of global tech-fests, Désiré now heads up TechRadar Pro. Previously he was a freelance technology journalist at Incisive Media, Breakthrough Publishing and Vnunet, and Business Magazine. He also launched and hosted the first Tech Radio Show on Radio Plus.