From Chicago Tribune:
Government-backed battery maker A123 Systems Inc. backed out of a deal Tuesday that would cede control of the company to a Chinese firm in the wake of mounting political pressure from federal lawmakers concerned about U.S. technology flowing to foreign competitors.
Instead, the struggling company filed for Chapter 11 bankruptcy protection Tuesday in a pre-packaged deal that would hand over control to Milwaukee-based Johnson Controls Inc. in a transaction valued at $125 million. China-based Wanxiang, which has its U.S. operations in Elgin, had agreed to invest up to $465 million in A123.
The deal with Wanxiang was still on as recently as Monday when A123 made a filing with the U.S. Securities and Exchange Commission related to the transaction. Analysts say the deal with Johnson Controls could see blow back from bondholders in bankruptcy court if Wanxiang is still interested in moving forward with the A123 deal, considering the Chinese firm’s significantly higher offer.
Wanxiang did not return calls Tuesday.