US court approves bankruptcy exit plan of B456 Systems

Article by Anita Panait, on May 22, 2013

United States Bankruptcy Judge Kevin Carey has approved the bankruptcy exit plan of B456 Systems Inc., formerly known as A123 Systems Inc. The bankruptcy exit plan entails paying the company’s creditors from the proceeds of asset liquidation. Caroline A. Reckler, lawyer for B456, told Bloomberg that they are thrilled with the results, adding that it is in the best interest of creditors. Reckler told Carey during the hearing that B456’s creditors have voted “overwhelmingly in favor of the plan.” With an approved plan, B456 could exit court protection in around three to four weeks, thereby putting an end to a bankruptcy that prompted fiery political debate over the government’s support for alternative-energy companies.

Republican presidential nominee Mitt Romney had used A123 as an example to attack President Barack Obama on what he dubbed as the administration’s failed investments in so-called green technology.

Right after A123 filed for bankruptcy, Romney campaign spokeswoman Andrea Saul, described the battery maker as yet another failure for Obama’s “disastrous strategy of gambling away” billions of taxpayer dollars on a strategy that does not work.

A123 filed for bankruptcy in October 2012 following the fallout of a proposed $465-million deal with Wanxiang Group Co. for an 80-percent stake as Republicans were having second thoughts on allowing the company’s sale to a Chinese company.

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