Proposed Aleris buyout by China firm nears collapse
NEW YORK: The proposed acquisition of United States aluminium-product maker Aleris Corp by Zhongwang USA LLC is at risk over national-security concerns raised by US officials, who are increasing scrutiny of takeovers of American companies by Chinese buyers.
Aleris and Zhongwang USA withdrew a notice seeking approval of the transaction from the Treasury Department’s Committee on Foreign Investment in the US (CFIUS), with Aleris saying in a filing on Wednesday there could be “no assurance” the deal would be approved, leaving it in limbo.
Either party could pull out of the merger before it expired at the end of the month, it said.
“CFIUS continues to raise national-security concerns with the merger,” said Aleris.
The Aleris deal, which would be China’s biggest-ever purchase of an overseas metals processor, is among a number of Chinese takeovers of US businesses that have come under heightened scrutiny during the Trump administration.
Last month, HNA Group Co’s proposed US$416 million (RM1.78 billion) investment in Global Eagle Entertainment Inc, an inflight entertainment and Internet-services provider, collapsed after the two companies failed to get approval from CFIUS.
“The parties have withdrawn the voluntary CFIUS notice and we are in discussions with Zhongwang about our further course of action,” said Aleris spokesman Jason Saragian. Bloomberg