Another Chinese acquisition fell apart Thursday after the deal met resistance from U.S. regulators determined to prevent business from threatening American national security.
U.S. chip company Xcerra and Hubei Xinyan Equity Investment Partnership, an investment group with funding ties to the Chinese government, abandoned an acquisition deal after realizing that approval by the Committee on Foreign Investment in the United States (CFIUS) was unlikely.
“Our transaction with Xinyan was about enabling Xcerra to accelerate its growth in the China market as well as broadening and strengthening our customer relationships around the world,” Xcerra Chief Executive Dave Tacelli said Thursday. “We are disappointed that we were not able to receive approval from CFIUS on this transaction.”
Since President Donald Trump took office last year, the U.S. has become much more skeptical of attempts by Chinese investors with concerning ties to the Chinese government to acquire American businesses in fields where China is striving to erode America’s strategic advantage, such as chip technology.
ALSO WATCH: President Trump Goes To China
Xcerra is not the first American chip company a Chinese investment group has tried to acquire.
The president personally intervened last September to block Canyon Bridge Capital Partners, a Chinese company with Chinese government support, from purchasing Lattice Semiconductors, a leading American chip maker that produces essential components used in military defense systems.
CFIUS rejected Ant Financial’s bid to buy U.S. money transfer company MoneyGram International Inc. in January due to national security concerns. Jack Ma, a Chinese citizen with ties to the Chinese government, owns Chinese internet conglomerate Alibaba Group Holding Ltd., which owns Ant Financial. There were concerns that the Chinese government could use the data to spy on American citizens, as well as political dissidents.
And, just last week, the Securities and Exchange Commission (SEC) blocked the sale of the Chicago Stock Exchange to Chongqing Casin Enterprise Group, a private company that denies having any ties to the Chinese government. Trump repeatedly criticized the deal on the campaign trail.
Freedom of Speech Isn’t Free
The Daily Caller News Foundation is working hard to balance out the biased American media. For as little as $3, you can help us. Make a one-time donation to support the quality, independent journalism of TheDCNF. We’re not dependent on commercial or political support and we do not accept any government funding.Content created by The Daily Caller News Foundation is available without charge to any eligible news publisher that can provide a large audience. For licensing opportunities of our original content, please contact [email protected].