US blocks sale of Moneygram to Chinese firm

US blocks sale of Moneygram to Chinese firm
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U.S. regulators are blocking the sale of MoneyGram, a money transfer firm, to a subsidiary of the Chinese company Alibaba, the companies announced Wednesday.

The chiefs of MoneyGram and Ant Financial said the sale was canceled after opposition from the Committee on Foreign Investment in the United States (CFIUS).

The CFIUS is as an interagency group of regulators based out of the Treasury Department that reviews pending foreign purchases of U.S. businesses for national security concerns.

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Ant Financial had been in talks to buy MoneyGram for “nearly a year” before the CFIUS blocked the deal, said MoneyGram CEO Alex Holmes.

“The geopolitical environment has changed considerably since we first announced the proposed transaction,” Holmes said. “Despite our best efforts to work cooperatively with the U.S. government, it has now become clear that CFIUS will not approve this merger.”

Alibaba, Ant Financial’s parent company, is one of the world’s most valuable businesses, worth nearly $500 billion. Doug Feagin, president of Ant Financial International, said the company was “excited and encouraged” about its future and said the company would partner with MoneyGram under a “new strategic cooperation.”

The CFIUS has blocked several other pending sales of U.S. businesses to Chinese firms since Trump took office amid growing tensions between the two countries over trade, intellectual property and Beijing's support for North Korea.

Trump in September on the advice of the CFIUS blocked the sale of Lattice, an Oregon-based semiconductor and chip manufacturer, to a group of investors who included Chinese state-owned entities.

Trump in January met Jack Ma, the billionaire founder of Alibaba.