Billion-dollar deals fall apart as U.S. and China get pickier - China’s latest business and technology news - SupChina

Billion-dollar deals fall apart as U.S. and China get pickier – China’s latest business and technology news

Chinese investments abroad in sectors deemed sensitive by host countries or undesirable by China are increasingly running into trouble:

  • A German biological products supplier called Biotest AG decided to resubmit its application for approval of a planned $1.5 billion acquisition by China’s Tiancheng Pharmaceutical Holdings, Caixin reports. The Committee on Foreign Investment in the United States (CFIUS), which was reviewing the acquisition because a Biotest AG subsidiary has plasma centers around the U.S., said that the proposed arrangement raised “national security concerns.”  
  • Paramount Pictures terminated a $1 billion deal for Huahua and Shanghai Film Group to fund 25 percent of its films over three years, according to Caixin. It is the latest Chinese venture in Hollywood to fall apart because of recent Chinese investment policies that de-emphasize money flowing into sports, entertainment, and real estate in favor of infrastructure and industry.
  • U.S. lawmakers continue to push for more oversight of Chinese money in America by strengthening CFIUS, Reuters says. In September, the same committee got its way and barred Chinese-backed private equity fund Canyon Bridge from acquiring Lattice Semiconductor Corp. But the New York Times explains (paywall) how some American companies have found new ways to skirt oversight and continue deal with China — for example, “Advanced Micro Devices…avoided scrutiny by licensing its exclusive microchip designs, rather than selling them.” The deal and others like it, the Times says, are part of a “new generation of deals that could give China a firmer grip on the technology of tomorrow.”

Lucas Niewenhuis

Lucas Niewenhuis is an associate editor at SupChina who helps curate daily news and produce the company's newsletter, app, and website content. Previously, Lucas researched China-Africa relations at the Social Science Research Council and interned at the Council on Foreign Relations in New York. He has studied Chinese language and culture in Shanghai and Beijing, and is a graduate of the University of Michigan.