Posted on March 7, 2008 at 9:37 AM
Filed under: Acquisitions | Best Practices | Deal International | Law | Trends
Tagged: 1988 Exon‐Florio amendment , Bear Stearns , Blackstone , China , China Investment , CITIC Securities , CNOOC , Committee on Foreign Investment in the United States , Defense Production Act of 1950 , emerging markets , Foreign Investment and National Security Act of 2007 , Haier , Hastings , HSR Act , IBM , Janofsky , law , Lenovo , M&A , Maytag , Mingsheng Bank , Morgan Stanley , Paul , Section 721 , UCBH Holdings , Unocal , Walker

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Leading up to the publishing of our next Corporate Dealmaker magazine later this month, we've been telling you about investments in the emerging markets. Our contacts at Paul, Hastings, Janofsky & Walker LLP just reminded us of the flip side of the equation with a  report called "Acquisition of U.S. Assets by Chinese Companies: Practical Considerations Under U.S. Law." In this account, the global M&A practice group warns non-U.S. companies contemplating acquisition of publicly and privately held U.S. assets of recent changes in U.S. antitrust and federal and state securities laws. They discuss this in the context of major deals in recent years, including:

• Lenovo Group Ltd.'s acquisition of IBM Corp.'s personal computer business,
• China Investment Corp.'s $3 billion investment in the Blackstone Group LP and recent $5 billion investment for a 9.9% share of Morgan Stanley, the mutual investment by China's government-controlled securities firm Citic Securities International Co. Ltd. and Bear, Stearns & Co., and
• Mingsheng Bank's proposed $317 million acquisition of a 9.9% stake in Nasdaq-listed UCBH Holdings Inc., the first Chinese investment in a U.S. bank.

And, just as important, recent failures:

• CNOOC Ltd. in its $18.5 billion bid for Unocal in June 2005, and
• China's appliance giant Haier Co. Ltd.'s failed acquisition of Maytag, also in 2005.

Paul Hastings delves into the HSR Act, the Foreign Investment and National Security Act of 2007; the 1988 Exon‐Florio amendment to the Defense Production Act of 1950, Section 721; the Committee on Foreign Investment in the United States; and a lot more. Also, see this feature from our May-June 2007 magazine highlighting/analyzing various Chinese overseas investments. - Baz Hiralal

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