President Obama to rule on Chinese bid to buy Aixtron

November 22, 2016 // By Peter Clarke
Metalorganic chemical vapor deposition (MOCVD) equipment vendor Aixtron SE (Herzogenrath, Germany), which is under a tender offer from China-controlled Grand Chip Investment GmbH, has decided to ignore a US recommendation to abandon the deal.

The Committee on Foreign Investment in the United States (CFIUS) was investigating the deal – even though Aixtron is a German company – from a US national security perspective. The review period lapsed on November 17. CFIUS informed Grand Chip Investment and Aixtron that there are unresolved US national security concerns and the two companies should abandon the transaction.

Both, GCI and Aixtron have decided not to follow this recommendation. As a result the matter has been referred to the U.S. President for decision in line with CFIUS statutes. The U.S. President is set to give his decision to block or allow the proposed transaction within 15 calendar days.

In October Aixtron said the German Federal Ministry of Economics and Energy had withdrawn its clearance certificate to allow Fujian Grand Chip Investment Fund LP, the indirect shareholder of Grand Chip Investment GmbH, to acquire Aixtron, originally issued on September 8.

Fujian Grand Chip Investment Fund LP is a Chinese investment fund; 51 percent of which is held by the Chinese business man Zhendong Liu and 49 percent by Xiamen Bohao Investment Ltd.

Grand Chip Investment's offer to acquire Aixtron, made in May 2017, valued the company net of cash, at approximately €670 million (about $700 million).

Aixtron said itself and Grand Chip Investment planned to try and find ways to make the deal acceptable to CFIUS or the U.S. President but there was no assurance that CFIUS or the US President would entertain further talks or that the deal would go forward.

 

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