The outgoing US President Obama speaks with the planned takeover of the German machine tool Aixtron. The concern about a military use by China creates security concerns among the Americans.
Shortly before the end of his term ends a topic also critical for Germany on the table of the US president Barack Obama. In the controversy over the takeover of the North Rhine-Westphalian specialist machine builder Aixtron by a Chinese company is to decide Barack Obama over a release. Finally, Swiss Federal Minister of Economics, Sigmar Gabriel, had stopped the already approved sale of Aixtron to the Chinese investor Fujian Grandchip to check whether military reasons were against it.
As Aixtron communicated at the late Friday evening, the US investigating foreign investment agency (CFIUS) sees unresolved US national security concerns as an obstacle. However, it did not wish to make a final decision. She therefore referred the case to the US President for decision. Your recommendation: Do not release. Obama now has 15 days to decide.
Previously, the US agency Aixtron and the Chinese Grand Chip Investment had recommended abandoning the project. The companies had rejected this. Rather, they wanted to continue to search for solutions, in order to bring the takeover still into dry cloths.
At the end of July, Grand Chip Investment placed a 670 million euro purchase offer for Aixtron. The company manufactures production machines for the chip industry, but recently suffered from price pressure and high development costs and is therefore in the red. Management recommended the offer.
Military use of technology feared
The Americans claim that Aixtron products can also be used for military purposes. The planned takeover has been stopped from Germany by an intervention of the US secret service. The Americans are supposed to have presented preliminary results, according to which Aixtron products could also be used for military purposes. In Washington, it is feared that China could use Aixtron chips in its nuclear program. Behind FGC is private investor Liu Zhendong, indirectly, however, the Chinese state holds almost half of the shares.
At the beginning of September Gabriel had already issued a safety certificate for the deal and withdrew it later. After the expiry of the acceptance period, the shareholders had already offered the Chinese investor approximately 60% of the Aixtron shares for purchase.
In general, the federal government remains skeptical about Chinese takeover attempts by German high-tech companies. There are also plans by the EU Trade Ministers to agree on safeguards by the end of the year. In this context, China’s status as a market economy would also play a role in the context of anti-dumping proceedings. The EU Commission would like to submit a proposal which the Federal Government will examine.
The US agency, CFIUS, has the task to examine assumptions with regard to the consequences for national security. According to experts, it is very rare that it immediately stops merger projects. Usually, the companies involved are informed of the resistance of the authority and then withdraw the application for approval of the takeover.