DOVER, Del. (AP) — Chinese auto parts conglomerate Wanxiang Group Corp. said Tuesday that a federal panel has approved its purchase of most assets of failed battery maker A123 Systems Inc.
The approval by the Committee on Foreign Investment in the United States (CFIUS) came more than a month after a Delaware bankruptcy judge signed off on the deal, valued at nearly $257 million.
"'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 Elgin, Ill.-based Wanxiang America.
A spokeswoman for the Treasury Department declined to confirm the decision by CFIUS, a federal interagency committee headed by Treasury Secretary Timothy Geithner that reviews sales of U.S. companies to foreign owners.
"By law, information filed with CFIUS may not be disclosed by CFIUS to the public," said spokeswoman Holly Shulman.
Waltham, Mass.-based A123, which makes lithium-ion batteries for electric cars, grid storage and commercial and military applications, received more than $130 million of a $249 million Department of Energy grant before declaring bankruptcy. A company spokesman declined to comment Tuesday on the CFIUS decision.
Critics of the deal repeated their concerns about the economic and security risks of U.S. technology acquired by foreigners.
"The approved sale marks yet another step in the coordinated strategy by foreign countries to acquire leading U.S. companies who are researching, developing and producing critical technologies," said Dean Popps, co-chair of the Strategic Materials Advisory Council, a group of retired military and defense industry officials. "CFIUS itself has recognized this strategy but it appears they continue to fail to do anything to prevent it."
Wanxiang beat Milwaukee-based auto parts marker Johnson Controls Inc. in bidding for most of A123's assets after the company sought bankruptcy protection. After its initial offer of $125 million for A123's automotive assets was trumped by Wanxiang, Johnson lobbied with other critics of the deal, including some members of Congress, trying to persuade CFIUS to deny approval of Wanxiang's purchase.
Rep. Bill Huizenga, R-Mich., said Tuesday that it's clear that the technology acquired by Wanxiang has both civilian and military applications.