Canyon Bridge Fund, a Chinese-backed firm has been in the process of acquiring the $1.3 billion worth Oregon-based technology manufacturer, Lattice Semiconductor, since November 2016. The U.S. Government has put a hold on this deal due to security concerns.
The U.S. has been toughening its stance on business dealings with China. The Trump administration rejected the deal as a result of security concerns.
The Trump administration is weary about the ‘potential transfer’ of intellectual property of Lattice Semiconductors into the hands of the Chinese firms. The U.S. government also uses products from the semiconductor giant.
Donald Trump confirmed his decision after the recommendation by the Committee on Foreign Investment in the United States, a government panel that reviews foreign transactions for national security concerns.
According to Darin Billerbeck, the Chief Executive of Lattice, stated the company underwent losses in 2016 and 2015. Canyon Bridge capital partners offered a premium on its share price.
Darin said, “The deal was in the best interest of our shareholders, our customers, our employees, and the United States.”
Canyon Bridge said in an email, “The shareholders are disappointed with the President’s decision.”
As per the China-based firm, the deal was expected to augment the opportunities for employment in America. The company would continue to pursue other investments elsewhere.
In August 2017, the U.S. launched a formal review citing China’s intellectual property practices. As per the U.S. agencies, China’s activities may force U.S. companies to reveal sensitive information.
The U.S. politicians and investors coerced the administration to scrutinize Chinese investments in the country, especially in the technology industries.
In the past, Former Presidents, George W. Bush and Barack Obama, had used their authority to block Chinese investments in the U.S.