DOE cancels remaining portion of A123 Systems grant
China's Wanxiang Group won an auction for most of the assets of A123, which makes lithium ion batteries for electric cars
The Department of Energy will not give energy storage firm A123 Systems the remaining half of its $249 million grant, following the company's bankruptcy and acquisition by a Chinese auto parts supplier, according to the DOE.
China's Wanxiang Group won an auction for most of the assets of A123, which makes lithium ion batteries for electric cars. This announcement follows Johnson Controls' withdrawal from a bankruptcy auction to acquire portions of A123 Systems.
A123 declared bankruptcy earlier in 2012 after several technical missteps and weak demand for electric cars. The company won its grant as a part of the Obama administration's $2 billion stimulus initiative to jump start domestic battery manufacturing.
The company had received about $133 million of its $249 million grant when it filed for bankruptcy protection in October.
According to the DOE, conditions of the grant require taxpayer funded equipment and facilities to stay in the U.S.
Wanxiang's takeover of A123 will need approval from the Committee on Foreign Investment in the United States. CFIUS, an inter-agency panel that vets foreign deals for security concerns, is headed by Treasury Secretary Timothy Geithner.