German Minister blocks Aixtron takeover and looks to curb Chinese spending spree

25/10/2016

german-economy-minister-sigmar-gabrielAixtron: With China’s appetite for buying up European companies showing no sign of abating and its year-on-year investment in Europe jumping by 62% to a record €20bn last year, the German Economy Minister Sigmar Gabriel this week ramped up pressure on the EU to impose tighter controls over foreign investment by withdrawing its approval for Fujian Grand Chip’s €728m takeover of Aixtron, the Aachen-based supplier of equipment to the global semiconductor industry. Gabriel has also tabled a proposal to his own government which, according to reports in Bloomberg, calls for EU member states to step in if a non-EU investor seeks to acquire more than 25% of the voting rights in a company.
AixtronThe German authorities’ change of heart for the deal – that was set to be an emblem of a new push by Chinese companies to acquire cutting-edge technology businesses and a sign of Berlin’s tolerance for such moves – took most people (including the team at Aixtron) by surprise and signals a significant shift in mood within Chancellor Angela Merkel’s government
Gabriel is Merkel’s deputy and, while his hasn’t publicly backed his initiative, Gabriel’s proposal reflects growing concerns within Germany over the extent of Chinese investment in its economy.
EU Digital Economy Commissioner Guenther Oettinger.In the meantime, Gabriel’s increasingly vocal opposition has won the support of another Merckel appointee, the EU’s Digital Economy Commissioner Guenther Oettinger. “It’s absolutely right to initiate this debate at the European level,” Oettinger said in an interview last week. “Everybody has to play by the same rules. Clearly, there are many countries, including big ones such as China, that make market access or corporate takeovers difficult or effectively impossible.”
PirelliIn a separate development, EU officials announced that the Swiss agribusiness concern Syngenta and ChemChina, which last year bought the Italian tyre manufacturer Pirelli for €7.3bn, had missed the deadline for submitting proposed remedies to resolve potential antitrust concerns relating to their planned merger. 

Source: Bloomberg