A123 Goes to Wanxiang in $260M Bankruptcy Auction Bid
Congressman Bill Huizenga, a Michigan Republican, wrote on his Facebook page: “I have serious concerns over the Chinese firm Wanxiang Group Corp attempt to buy A123. I am concerned this transaction poses a threat to U.S. national security, America’s global innovation leadership and job creation.” According to Huizenga, A123’s contracts with the DOE involve power grids, advanced armor, unmanned vehicles and portable power systems.
I could not agree more. New technology that is inherent in our military applications is usually limited from export by what is know as ‘export control’ limitations imposed by the Federal Government. I know because I was an export control officer when I served at Fort Monmouth New Jersey. So limiting the technology developed in this country vital to the defense needs must be protected. I am not enough of an expert in batteries to say that A123 is the most vital battery technology available, but other experts at the Department of Energy supposedly are expert in assessing the technology of A123 as compared to what else is available here. The corporate world works on the rule of the fiduciary who acts at all times for the sole benefit and interest of the one who trusts (investors). Forget loyalty, social benefit, patriotism because all these are not the concern of the corporation who are ruled to serve the best interests of their investors, whomever they may be.
“This may be the closing chapter of A123 Systems as a U.S.-owned firm. According to news reports citing sources with knowledge of the matter, lithium-ion battery maker A123 is now owned by Wanxiang Group, China’s largest maker of auto parts and a major supplier to Ford and General Motors.
Wanxiang’s $260 million bid bested a joint offer from Johnson Controls and NEC for control of most of the assets of A123, including the automotive battery business that Johnson Controls had wanted to purchase, a representative of Lazard Freres, investment banker for A123, told Reuters. Germany’s Siemens was also a bidder, according to news reports.
Wanxiang’s apparent winning bid is sure to raise an outcry in Washington, D.C., however. A123 had received $250 million in U.S. Department of Energy grants and has spent about half of the funding to build its key battery plants in Michigan. The company is also developing battery storage technology for the U.S. military, an area that could raise national security concerns — although according to reports, A123’s government business will be sold separately to U.S.-based Navitas Systems for $2.25 million, which could assuage some concerns on that front.”