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China Stalling Merger Reviews of US Chip Firms, Others – WSJ

Merger reviews have become an additional tool for Beijing in its tit-for-tat fight with Washington over access to advanced technology


Chinese regulators have slowed reviews of several proposed acquisitions by US companies, according to a report by the Wall Street Journal on Tuesday.
Intel's plan to acquire Tower Semiconductor has been delayed by strained Sino-US ties. The WSJ said If two companies in a deal have revenue of more than $117 million a year from China, the merger needs Beijing to sign off on it. Pic: Towersemi.com.

 

Regulators in China have slowed reviews of several proposed acquisitions by US companies, according to a report by the Wall Street Journal on Tuesday.

The move is seen as a response to Washington’s curbs on China’s tech industry.

The potential slowdown includes deals such as Intel’s $5.2-billion takeover of Tower Semiconductor and chipmaker MaxLinear’s $3.8 billion purchase of Silicon Motion Technology Corp, and possibly Broadcom’s $61-billion bid for cloud computing company VMware.

China’s State Administration for Market Regulation has asked the companies involved to make products they sell in other countries available in China in a bid to counter US export controls on China, the report said, citing people close to the process.

The competition regulator, which has made this demand a precondition to approving the deals, could not be immediately reached for a comment.

ALSO SEE:

China Calls on WTO to Review Chip Export Curbs Led by US

 

As US-China ties fray, merger reviews have become an additional tool for Beijing in its tit-for-tat fight with Washington over access to advanced technology.

Approval is required from Chinese authorities if companies involved in a deal have a sizable business presence in the country.

If two companies in a deal have revenue of more than $117 million a year from China, the merger needs Beijing to sign off, according to the WSJ report.

Intel, Tower, MaxLinear and Silicon Motion did not immediately respond to requests for comment.

 

  • Reuters with additional editing by Jim Pollard

 

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Japan Joins US Chip War Against China With Export Restrictions

 

Huawei Beats US Sanctions With Chip Tool Breakthrough

 

 

Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years.

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