The Chinese Still Want A123
When we reported that battery maker A123 had filed for bankruptcy, a lot of people thought that Johnson Controls is in control, and that Chinese Wanxiang is out. No and no, writes Reuters star car reporter Norihiko Shirouzu. Wanxiang still wants A123, and Johnson Controls is just one bidder in a Chapter 11 process, says Reuters.
China’s Wanxing had offered $465 million for all of A123. A123 agreed to sell its automotive operations, including two factories in Michigan, for $125 million to Johnson Controls. That “deal could be countered by other offers that would be more beneficial to A123’s creditors,” Jefferies analyst Peter Nesvold said in a research note. “Wanxiang is the most likely other participant in this process, and we are not aware of other suitors at this time.” A123’s creditors most likely would prefer someone who pays $465 million for all of A123 instead of someone who pays $125 million for a part of the company, with no takers for the rest.
In August, Wanxiang had announced its intentions to take over A123. The Chinese company immediately gave A123 a $22.5 million loan, including a cash advance of $12.5 million. Wanxiang offered more money, based on a list of requirements, including approval from the Committee of Foreign Investment and the Chinese government, as well as the absence of any default. “Shortly before filing for bankruptcy, it became apparent that A123 would fall short of some of those conditions,” Reuters remarks dryly. The bankruptcy tripped another circuit breaker.
Reuters also remarks that “A123 Systems, which won a $249 million U.S. government grant in 2009 for jump-starting its business” wanted to sell to Johnson Controls, which is “another recipient of federal green subsidies.”
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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Chinese want that technology and will get it. The USA will lose everything: money, tech, and jobs.
As it struggled, A123 showered Democrats with donations, hired pricey lobbyist http://www.washingtonguardian.com/battery-makers-beltway-power-play Have fun folks. Peace. Out.