Trump blocks sale of US chip company to China-backed firm

Trump blocks sale of US chip company to China-backed firm
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President Trump on Wednesday blocked the sale of a United States electronics company to a group that included Chinese investors, citing national security risks.

Trump ceased the pending sale of Lattice, an Oregon-based semiconductor and chip manufacturer, to a group of investors including China Venture Capital Fund Corporation, which is owned by Chinese state-owned entities.

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Trump's decision to personally stop the sale was based on fears that an investment fund with ties to Beijing could send sensitive manufacturing and intellectual property information to the Chinese government, according to Treasury Secretary Steven MnuchinSteven Terner MnuchinOvernight Finance: CBO to release limited analysis of ObamaCare repeal bill | DOJ investigates Equifax stock sales | House weighs tougher rules for banks dealing with North Korea Week ahead in finance: Clock ticking for GOP on tax reform More former classmates of Mnuchin call on him to resign MORE.

Mnuchin said Trump blocked the deal due to unavoidable concerns about “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.”

Trump’s decision to block the sale came after the U.S. Committee on Foreign Investment, which reviews the sale of U.S. companies for national security risks, recommended he halt the sale.

Government officials and cybersecurity experts have long warned that Chinese companies, often with state aid, steal sensitive business information from rival American businesses.

Trump has also threaten to cut off economic ties with countries that support North Korea’s economy or fail to enforce sanctions against transactions with North Korea, including China.

Canyon Bridge, an American investment firm that was among the investors blocked by Trump's decision, said it was "obviously disappointed" by the move to kill "what we believe to be an excellent deal for Lattice's shareholders and its employees by expanding the opportunity to keep jobs in America."

"We remain focused on other investment opportunities where we can work with exceptional companies to create jobs and grow revenue," the firm said in a statement.

--Updated at 7:25 p.m.