A123 purchase by Wanxiang remains uncertain

The recent purchase of the A123 Systems Inc. by China's largest auto parts maker Wanxiang Group remains uncertain amid possible sabotage despite an U.S. court approved the deal.

A123, which was partly funded with U.S. government money, was sold at an auction on Saturday for $256.6 million to Wanxiang Group of China, Reuters reported.

The news was announced at Tuesday's hearing by Delaware Bankruptcy Judge Kevin Carey.

According to Wanxiang's investment bank Lazard Freres, the Group offered the highest bidding price, surpassing that from Johnson Controls, Inc. and Japan's NEC Corporation.

"I'm troubled by suggestions that someone who participated in the auction may in fact already be working against it," Reuters cited Kevin Carey at the end of Tuesday's hearing.

Johnson Controls had said it remains interested in A123 if Wanxiang fails to get approval from the U.S. government, which is coming under pressure to block the deal.

The deal was seen as politically sensitive since A123 was funded by the U.S. government and provided technology support to the U.S. military.

The Group failed in its attempt to buy stakes in A123 in August after the move was blocked by the U.S. government and later A123 declared bankruptcy.

The company filed for bankruptcy in October as demand for electric vehicles did not live up to expectations and it was forced to recall defective car batteries.