* Wanxiang gets Beijing backing to acquire U.S. battery
* A123 takeover hinges on U.S. government approval
SHANGHAI Nov 30 China's government has approved
a plan by Wanxiang Group Corp, a major Chinese auto parts maker,
to acquire bankrupt U.S. battery maker A123 Systems Inc
, although a deal still hinges on the outcome of an
auction next month and U.S. government approval.
A123, a maker of lithium ion batteries for electric cars,
filed for Chapter 11 bankruptcy protection in October with a
plan to sell its battery business to Milwaukee-based Johnson
Controls for $125 million.
The planned sale will depend on whether better bids are
received at next month's auction. Wanxiang has said it intends
to make a bid.
China's National Development and Reform Commission, whose
approval is required for major overseas acquisitions by Chinese
companies, said in a statement posted on its website on Friday
that it had approved Wanxiang's plans for a bid.
Any deal for A123 must receive the blessing of the U.S.
government, however, as the company has received a $249 million
grant from the Energy Department.
Republican Senators John Thune and Chuck Grassley have
raised concerns about Wanxiang's attempt to acquire A123's
battery business, saying military and taxpayer-funded technology
should not be allowed to fall into foreign hands.
The Energy Department has stressed that none of the
government's grant would be allowed to fund facilities abroad.