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Chinese company wins auction for bankrupt maker of electric car batteries despite concerns

China’s largest auto parts maker won U.S. government approval to buy A123 Systems, a maker of electric car batteries, despite warnings by some lawmakers that the deal would transfer sensitive technology developed with U.S. government money.

The sale of the lithium-ion battery maker to a U.S. unit of Wanxiang Group was approved by a U.S. government committee on foreign investment, according to a statement from the Chinese company. The companies later said the deal had been completed.

Last month, Wanxiang’s U.S. unit agreed to pay $257 million for A123’s automotive battery business and related assets in a bankruptcy auction, beating U.S. rival Johnson Controls of Milwaukee.

But the transaction still needed approval by the Committee on Foreign Investment in the United States, a government body led by the Treasury secretary. The committee approved the deal on Monday night, according to Wanxiang.

“Wanxiang America looks forward to closing the transaction and to continuing to foster the technologies A123 has worked so hard to develop,” said Pin Ni, the president of Wanxiang America, in a statement.

Jason Forcier, president of the newly formed A123 Systems’s auto business, said Wanxiang was focused on pushing A123 to profitability within a few years. “Wanxiang obviously brings financial stability to the company that we haven’t had in at least the last six to 12 months,” he said in a telephone interview.
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