Obama Blocks Chinese Takeover Of Aixtron's US Business

(RTTNews) - President Barack Obama blocked the acquisition of the U.S. business of Aixtron by Grand Chip Investment GmbH (Grand Chip) and certain of its direct and indirect shareholders (together, the Purchasers), according to a statement Friday by the Treasury Department.

The order directs the Purchasers and Aixtron to take all steps necessary to fully and permanently abandon the proposed acquisition of Aixtron's U.S. business not later than 30 days after the date of the order.

The Treasury Department said the ban follows a recommendation from the Committee on Foreign Investment in the U.S., or CFIUS, which confidentially reviews foreign acquisitions solely on national-security grounds.

"The national security risk posed by the transaction relates, among other things, to the military applications of the overall technical body of knowledge and experience of Aixtron," according to the statement.

Grand Chip is a special purpose investment owned by investors in China, some of whom have Chinese government ownership, according to the Treasury statement.

Aixtron makes equipment for the semiconductor industry, including Metal-Organic Chemical Vapor Deposition (MOCVD)systems used to build compound semiconductor materials. Aixtron's U.S. business includes its wholly owned subsidiary, Aixtron, Inc., which is organized and headquartered in California.

The proposed acquisition was to be funded in part by Sino IC Leasing Co. Ltd., which belongs to an industrial investment fund established by the Chinese government to develop the country's integrated circuit industry, the Treasury added.