CFIUS blocks sale of Lattice Semiconductor to Canyon Bridge FundStaff Writer | September 14, 2017
As chair of the Committee on Foreign Investment in the United States (CFIUS), Steven T. Mnuchin, Secretary of the Treasury issued a statement about the President's decision regarding Lattice Semiconductor Corporation.
Acquisition A risk to the national security
"The order directs the Purchasers and Lattice to take all steps necessary to fully and permanently abandon the proposed acquisition of Lattice not later than 30 days after the date of the order.
"CVCF is a Chinese corporation owned by Chinese state-owned entities that manages industrial investments and venture capital. Lattice is a publicly traded company headquartered in Oregon that manufactures semiconductors for the consumer, communications, and industrial markets.
"Lattice's primary semiconductor product lines are programmable logic devices, which are general purpose semiconductors that customers can program to provide functionality similar to chips that are designed and produced for specific applications.
"The President took this action pursuant to section 721 of the Defense Production Act of 1950, as amended by the Foreign Investment and National Security Act of 2007 (Section 721).
"Section 721 authorizes the President to suspend or prohibit certain acquisitions of U.S. businesses by foreign persons where he finds that there is credible evidence that the foreign interest exercising control might take action that threatens to impair national security, and where provisions of law other than Section 721 and the International Emergency Economic Powers Act do not provide adequate and appropriate authority to protect national security in the matter under review.
"The President's decision took into consideration the factors described in Section 721's subsection (f), as appropriate, and the recommendation by CFIUS that he issue an order prohibiting this transaction.
"CFIUS and the President assess that the transaction poses a risk to the national security of the United States that cannot be resolved through mitigation
"The national security risk posed by the transaction relates to, among other things, the potential transfer of intellectual property to the foreign acquirer, the Chinese government's role in supporting this transaction, the importance of semiconductor supply chain integrity to the U.S. government, and the use of Lattice products by the U.S. government.
"CFIUS is an interagency committee whose purpose is to review transactions that could result in the control of a U.S. business by a foreign person, in order to determine the effect of such transactions on the national security of the United States.
"CFIUS's detailed analysis of the proposed transaction took into account all relevant national security factors, as enumerated in Section 721. CFIUS also received a thorough analysis of the threat posed by this transaction from the Office of the Director of National Intelligence, as required by Section 721." ■