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ARTICLE · 17 JANUARY 2017

The Developing CFIUS Framework And Recent Presidential Order Prohibiting The Aixtron Transaction

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Among the various challenges facing stakeholders in cross-border M&A deals is a potential national security review of the transaction by the Committee on Foreign Investment in the United States (CFIUS)...

United StatesGovernment, Public Sector
Seth Engel
Seth Engel
Melvin Schwechter
Melvin Schwechter
Walter Van Dorn
Walter Van Dorn
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Among the various challenges facing stakeholders in cross-border M&A deals is a potential national security review of the transaction by the Committee on Foreign Investment in the United States (CFIUS) and the possibility of such review impeding, or even blocking, a non-U.S. acquirer of a U.S. business.

On Dec. 2, 2016, President Barack Obama issued an order, on the recommendation of CFIUS, prohibiting the acquisition of a German semiconductor manufacturer, Aixtron SE (Aixtron) by a German company, Grand Chip Investment GmbH (Grand Chip), beneficially owned by Chinese nationals.

Aixtron and its subsidiaries manufacture equipment for the global semiconductor industry, including metal-organic chemical vapor deposition (MOCVD) systems used to build compound semiconductor materials with military applications. Aixtron’s U.S. subsidiary is headquartered in and operates out of Sunnyvale, California.

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