Updating a story that we have been blogging about, a federal judge approved the sale of A123 Systems Inc. to China’s Wanxiang America Corp. last week for $256.6 million.
A123, a popular electric car battery manufacturer, filed for Chapter 11 bankruptcy this fall in an attempt to find buyers.
According to Dow Jones & Company, Inc., U.S. Bankruptcy Judge Kevin Carey approved the sale of A123’s assets. The sale now has to be approved by the Committee on Foreign Investment in the United States, a Washington government body that reviews deals that could result in the control of U.S. businesses by a foreign person or company.
There are expected to be arguments against the sale. According to Dow Jones & Company, more than two dozen lawmakers, including Republican Senators Chuck Grassley of Iowa and John Thune of South Dakota, have voiced concerns that some of A123’s military contracts could wind up in the hands of a foreign purchaser.
Another issue that will need to be resolved is a $249 million grant that A123 received from the US Department of Energy. Lawyers for the government said they are still deciding how to proceed with collecting the debt following the approval of the company’s sale.
Chapter 11 bankruptcies allow businesses to remain in control of their operations while searching for investors or buyers. Individuals struggling financially can file for Chapter 13 or Chapter 7 bankruptcy, which allows you to discharge debts like credit card debt and medical bills.
If your financial situation is a problem, contact our Washington DC and Maryland bankruptcy lawyer now for a free consultation.