Tuesday, January 29, 2013

Read the peice and add up the numbers to see how much taxpayers lost. Another Obama loser

U.S. approves sale of A123 to Chinese firm

Washington — The Obama administration approved the sale of most of bankrupt battery maker A123 Systems' assets to Chinese firm Wanxiang Group Corp.
The company's U.S. subsidiary, Chicago-based Wanxiang America, said it has received approval from the Committee on Foreign Investment in the United States to complete its acquisition of substantially all of the non-government business assets of A123 Systems, Inc.
"We're pleased the government has completed its review and provided us with the go-ahead to finalize this transaction," said Pin Ni, president of Wanxiang America. "The future is bright for A123. It is a company with exceptional talent and potential, and Wanxiang America is committed to its long-term success and the continuance of its U.S. operations. Wanxiang America looks forward to closing the transaction and to continuing to foster the technologies A123 has worked so hard to develop."
In December, Wanxiang won a bankruptcy court auction to acquire most of A123 for $256.6 million, including its grid and commercial business assets and its U.S. facilities in Michigan, Massachusetts and Missouri.
A123 had vowed to create 3,000 jobs by the end of 2012, but only has 1,300. It won $249.1 million in grants from the Obama administration in 2009 to build battery plants in Romulus and Livonia, but has only spent $132 million. It also received more than $125 million in tax credits and funding from the state of Michigan.
Navitas Systems, a Woodridge, Ill.-based company, has agreed to buy A123's Ann Arbor-based government business, including all U.S. military contracts for $2.25 million.
President Barack Obama hailed A123 and even invited the company's CEO to the Rose Garden in April 2010.
"This is what happens when we place our bets on American workers and American businesses. And we're going to continue working to help them manufacture more success stories like these across all sectors of our economy," Obama said.
A123 filed for bankruptcy in October and initially sought approval to sell the bulk of itself to Johnson Controls Inc. in less than six weeks.
A123 has 625 employees at plants in Romulus and Livonia and an Ann Arbor office, along with 348 temporary workers in the state.
The Waltham, Mass., startup — which has lost $900 million since 2007 — received $50 million in debtor in possession financing from Wanxiang.
In November, Michigan's two senators and 11 House members raised concerns that the acquisition of bankrupt battery maker A123 by a Chinese company may pose a "threat to U.S. national security."
In a letter to Treasury Secretary Tim Geithner — who chairs the Committee on Foreign Investment, which reviews the sale of U.S. companies — Sens. Carl Levin, D-Detroit, Debbie Stabenow, D-Lansing, and members of the House raised concerns.
Rep. Bill Huizenga, R-Zeeland, said Tuesday the decision hasn't "changed my opinion that the core technology developed by A123 and the intellectual property that goes along with it can be separated along A123's business lines. It is also apparent that this technology was developed using taxpayer dollars through President Obama's stimulus program and is now falling into the hands of a foreign company. American taxpayers should not be funding technology that will in turn be used in competition against American companies."
Huizenga said he is "currently looking into legislative solutions to prevent both taxpayer-funded and sensitive technologies from being sold to foreign companies in the future."
The company is the latest in a string of advanced battery firms that have gone bankrupt despite millions of dollars in subsidies from state governments and the Bush and Obama administrations.
In January, New York-based Ener1 filed for bankruptcy protection. A similar filing was made in March by Canada-based Azure Dynamics, which has offices in Oak Park and installs the battery electric powertrain in Ford's Transit Connect.
The Obama administration awarded $2.4 billion in stimulus grants in August 2009 for advanced batteries and electric vehicles, saying the awards would create thousands of jobs.
The president set a goal of 1 million electric vehicles on the road by 2015, but sales have totaled fewer than 40,000 since 2011. Many battery suppliers have created a small fraction of the promised jobs.

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