Court Approves A123 Systems Interim DIP Loan
U.S. Bankruptcy Judge Kevin Carey in the U.S. Bankruptcy Court for the District of Delaware has granted interim approval for A123 Systems to borrow $15.5 million in debtor-in-possession financing from Johnson Controls.
The loan will be used while the company, an electric car battery manufacturer, tries to sell its assets. The approval came, a Bloomberg article said, after Johnson Controls, which is in talks to purchase the company, decreased the interest rate from 15% to 13.5%.
A hearing is slated for October 30 for approval of the total $72.5 million DIP loan.
A related Wall Street Journal article noted that there is currently a “bidding war” between Johnson Controls and Chinese auto parts manufacturer Wanxiang Group Corp. for the assets of A123 Systems. Previously, A123 Systems had an agreement with the Chinese company but abandoned the deal when it filed for bankruptcy.
Wanxiang Group’s attorney said the company is still interested in A123 Systems and presented a competitive bid for the assets.
To read the Bloomberg article, click here.
To read the Wall Street Journal article, click here.
Previously on abfjournal.com: