a123 assets go to chinese firm for $256.6 million - energy storage companies

A123 Systems
Waltham battery maker said on Sunday it plans to sell almost all of its assets to the North American division of China's largest auto parts maker for $256.
6 million, pending approval by the U. S. Bankruptcy Court and the federal government.
What is the impact of Wanxiang's new ownership?
It is unclear what a123 is doing and working in Michigan and Massachusetts, but Wanxiang says it is committed to maintaining and expanding the company's business in the United States.
A123 has about 1,000 employees in the United States, of which about 300 are in Massachusetts.
David vio, chief executive of A123, said he believes a123 is developing the business of utilities --
Scale storage of power grid and its research-and-
The development business will remain in Massachusetts, and Wanxiang's main focus will be not on layoffs, but restructuring to advance the company and its technology at a lower expense rate.
A123 has never reported a profit.
"They think it's an investment in the future," he said . "
"They support long very much-
Long-term growth prospects for the business. ’’In an e-
Pin Ni, president of Wanxiang United States, said: "Just like any enterprise, improving efficiency and profitability is the basis.
But we will invest and we want to see A123 become a healthy company.
"A bankruptcy judge in Delaware will hold a sales hearing on Tuesday and a decision is expected to be made soon.
Since Wanxiang United States is owned by Wanxiang Group of China auto parts group, the acquisition of a123's assets must be approved by the Foreign Investment Commission of the US Treasury Department.
Vieau said the commission may not rule on the universal agreement by the end of January.
Prior to that, a123's assets would be placed in the trust, which would manage the company during that period, he said.
"A123 will continue to exist as a company and as a brand," Vieau said . " He added that he will remain at the company at least after the deal is over.
Wanxiang defeated several competitors, including Johnson control.
Milwaukee and NEC Japan
In a bankruptcy auction that began on Thursday, the auction lasted until around four in the morning. m. Saturday.
Under the agreement, Wanxiang will acquire a123's automotive, power grid and commercial battery business, including all the company's technology, products and private customer contracts, as well as manufacturing plants in Michigan, Massachusetts and Missouri.
It will also acquire a manufacturing company in China, as well as its interest in a joint venture with the Chinese carmaker Shanghai Motor Company.
Government of A123-
Basic businesses, including all US military contracts, will be acquired for a separate $2.
The 25 million deal is made by Navitas Systems Limited, a relatively new energy storage company in Woodbridge, Ill.
On Sunday, several people involved in the auction said they believed Wanxiang's acquisition of A123 would be approved as necessary.
"To be fair, the company and the creditor committee are very focused on a transaction with the highest amount, and we are confident that this transaction will end," said Tim Pohl, general manager of lazard Freres and Co.
It is an investment bank that leads A123 through the sales process.
"There are a lot of rounds of active bidding, so it's a tough one-
Fight to Make Wanxiang stand out.
"William Baldiga, counsel for the official committee of unsecured creditors in the bankruptcy of A123, echoed this sentiment, he said that unsecured creditors, after having secured creditors settled their claims, should receive some money from the transaction, although it is too early to say how much.
"For us, the whole focus is on what is best for creditors," Baldiga said . ".
"We are satisfied that this result is indeed the best for creditors.
"For Wanxiang, the announcement ended the long-standing positive courtship of a123.
In August, Wanxiang agreed to invest $0. 465 billion in exchange for a 80% stake in the company.
But it quickly drew criticism from congressional leaders, who were concerned that a Chinese company would acquire sensitive technology developed with taxpayer funding, including nearly $0. 25 billion in federal grants for A123, to expand the manufacturing capacity of Michigan.
Eventually, A123 was created in 2001 using technology developed by MIT, only to run out of time and money --
Victims of high production costs, slow adoption of electric vehicles, and costly recalls earlier this year.
A123 filed for bankruptcy protection in midOctober.
A123 will be the fifth.
This year, Wanxiang, which has 3,000 American employees, invested in energy in the United States.
Ni Ping, president of Wanxiang United States, said he believes the company will make A123 successful.
"Because we are not a public company, I believe we can have more freedom to support its development," he said.