Segment Y : Wanxiang wins nod for bankrupt A123

Headlines 31 Jan 2013
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China's largest auto parts maker has won US government approval to buy A123 Systems Inc, a bankrupt maker of electric car batteries that was funded with US government money, a source familiar with the situation said on 29th January.

A US government committee on foreign investment approved the sale of the lithium-ion battery maker to Wanxiang Group, according to the source.

A123 filed for bankruptcy in October due to weaker-than-expected demand for hybrid vehicles and technical problems. The company had received a US$ 249 million grant from the US government to promote clean energy, although about half of that money was never used.

The company was sold in December at an auction supervised by the US Bankruptcy Court in Delaware. Wanxiang's bid of about US$ 257 million won against US rival Johnson Controls Inc of Milwaukee.

The money raised in the auction will be used to repay the battery maker's debts of about US$376 million.