The Washington insiders who work to get Chinese deals approved

Wed Feb 24, 2016 5:20pm EST
 
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By Diane Bartz and Greg Roumeliotis

WASHINGTON/NEW YORK (Reuters) - A spate of proposed Chinese takeovers of U.S. companies, from the Chicago Stock Exchange to makers of high-end semiconductors, has created a vibrant business for a small circuit of Washington insiders who advise on how to get cross-border deals approved by the U.S. government.

Several former U.S. officials have in recent years joined the ranks of lawyers, consultants and lobbyists that have emerged as key brokers in trying to get Chinese acquisitions or investments in U.S. companies approved by the Committee on Foreign Investment in the United States (CFIUS), which scrutinizes deals for national security concerns.

Because this interagency panel, comprising 16 U.S. government departments or agencies and chaired by the Treasury, does not publish its decisions or its reasoning for them, advisers say inside knowledge and connections are important to navigate what outsiders often see as a "black-box" review process.

There have been 22 M&A transactions announced in the United States so far in 2016 involving Chinese acquirers, worth a combined $23 billion, according to Thomson Reuters data. That is a massive increase from 88 deals worth $13 billion for all of 2015, and 88 deals for $7 billion in 2014.

For a graphic showing Chinese acquisitions of U.S. companies by number and value, see tmsnrt.rs/1T4e6hF

It has all boosted corporate demand for former officials who served on CFIUS or have knowledge of the inner workings of the agency, several lawyers, consultants and lobbyists involved in the advisory work told Reuters.

"We're just completely overwhelmed," said one lawyer involved in advising on the CFIUS process, who asked not to be named because he was not authorized to speak with the media.

China's aggressive, often state-backed overseas buying spree has set off alarm bells among some politicians in Washington who are already on edge as China’s armed forces expand their presence in the South China Sea and because of high-profile hacking attacks against U.S. government agencies and corporations, which U.S. officials and security software companies have blamed on China.   Continued...

 
Chinese acquisitions of U.S. companies by number and value.  REUTERS/Graphics