Originally Posted by pythagoras
There are a lot of big time investors in this deal who stand to lose significant amounts from bankruptcy. Maybe they're finding a creative way to pony up to the DOE and avoid bankruptcy?
True, and the DOE is between the Devil and the deep blue sea, so to speak. They can do the politically safer route, stand tough, and force the company into BK, thus destroying a lot of value and shareholder equity in the process and devaluing their own collateral but look like they are in fact taking some action.
On the other hand, they could take a businesslike approach and try to maximize the value of the assets for a potential buyer, but that would invite the charge of being soft on another Solyndra, and worse look like they are presiding over the sale of American technology, that is now suddenly very strategic, to foreign countries, particularly those in Asia.
Either way, it's going to be tragic and wasteful, but based on the A123 precedent, I think the BK route will give the DOE more political cover if FA is going to be sold to foreign interests, even though it may actually reduce DOE's own recovery.