By Benjamin Goad - 06/20/13 02:42 PM EDT
A bipartisan group of 15 senators wants greater oversight of Shuanghui International’s $4.7 billion takeover of the nation’s largest pork producer.
“We need to take a look at this,” Sen. Debbie Stabenow (D-Mich.) said Thursday during an appearance on CNBC. “There’s serious implications – broad implications – because food security really is national security.”
Stabenow, Chairwoman of the U.S. Senate Committee on Agriculture, Nutrition and Forestry; the panel’s top Republican, Sen. Thad Cochran (Miss.); and thirteen other senators asked Treasury Secretary Jack Lew to allow the agencies to review the proposed deal.
Lew serves as chairman of the Committee on Foreign Investment in the United States (CFIUS), an interagency committee charged with determining whether purchases of U.S. businesses by foreign interests could threaten national security.
As such, Lew has the authority to expand the process to include other regulators, and should do so in the Smithfield deal, which would be the largest takeover ever of an American firm by a Chinese company.
In 2011, it was revealed that some Shuanghui products contained a hazardous and banned chemical used to make meat leaner. The case was just one part of an ongoing scandal involving tainted or fake Chinese meat.
“We have high safety standards,” Stabenow said. “Shuanghui is a company that’s had a very spotty safety record around pork.”
In the House, Rep. Rosa DeLauro (D-Ct.) has also raised concerns about the blockbuster deal.
The lawmakers are also concerned about the long-term implications of Chinese purchases of U.S. food companies and believe greater government scrutiny of the deals will be necessary going forward.
“Considering the potential for other foreign acquisitions of American food and agriculture companies, we also have a number of broader questions about how these transactions are reviewed and whether the appropriate authorities are evaluating potential risks and proposing sufficient mitigation measures to protect American interests,” the lawmakers wrote.
CFIUS is prohibited by law from discussing any of the cases under its review, and has declined comment on the Smithfield case.