Pro­posed Aleris buy­out by China firm nears col­lapse

New Straits Times - - Business -

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

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