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Johnson Controls Appeals Sale of A123 to China’s Wanxiang

Dec 18, 2012
Source: 
(Greentech Media)

It’s official: Johnson Controls has filed an appeal to the bankruptcy court sale that saw it lose its bid for A123’s assets to Chinese auto equipment giant Wanxiang. But it’s not demanding to stop the sale -- though it stands ready to take over the bankrupt lithium-ion battery maker if politics gets in the way of Wanxiang’s takeover of the company.

That’s the gist of a Monday announcement from Johnson Controls, which said it has filed an appeal in U.S. Bankruptcy Court in Delaware to get back a $5.5 million breakup fee it had given the court to participate in the bid for A123’s business. Johnson Controls, which had sought to acquire A123’s automotive assets out of bankruptcy for $125 million, but bowed out of the auction after a final bid of $251 million jointly with Japan’s NEC, about $5 million short of what Wanxiang has pledged to pay.

U.S. Bankruptcy Judge Kevin Carey put that $5.5 million in escrow last week, after being told by attorneys representing unsecured creditors that JCI had been lobbying in Congress to have Wanxiang’s bid blocked. But Monday’s statement from Alex Molinaroli, president of Johnson Controls Power Solutions, said that it’s appealing the sale in order to get back that money.