Chinese billionaire Jack Ma’s (馬雲) latest US expansion plan is facing rising political obstacles.
Two members of the US House of Representatives on Friday urged the Committee on Foreign Investment in the US (CFIUS) to conduct a “full and thorough” investigation of Ant Financial’s (螞蟻金服) proposed acquisition of MoneyGram International Inc, a money-transfer service.
“The proposal merits careful evaluation as it would provide Chinese access to the US financial infrastructure, a move that would pose significant national security risks if completed,” US Congressman Kevin Yoder and US Congresswoman Eddie Bernice Johnson wrote in a letter to US Secretary of the Treasury Steven Mnuchin.
Formerly a financial-services affiliate of Alibaba Group Holding Ltd (阿里巴巴) and controlled by Ma, Ant made its bid in January for US$880 million, or US$13.25 a share. Last month, Leawood, Kansas-based rival Euronet Worldwide Inc came in at US$15.2, saying its offer had a better chance at regulatory approval.
Dallas-based MoneyGram entered a confidentiality agreement with Euronet late last month to further consider its unsolicited proposal.
Chinese companies have been on an acquisition spree in the US for many years, but the trend has slowed recently in the face of mounting political opposition and national security concerns. In December last year, German semiconductor maker Aixtron SE’s planned sale to a Chinese-based company fell through after then-US president Barack Obama upheld a CFIUS recommendation that the sale should be stopped. Aixtron has a subsidiary in California and about 20 percent of its sales are generated in the US.
US President Donald Trump has taken a hard stance on China, increasing the chance Ant Financial’s bid will be closely scrutinized by CFIUS, an inter-agency panel that examines acquisitions of companies by foreign investors. The White House can stop the deal, and Mnuchin is chairman of the panel.
Research firm Beacon Policy Advisors expects the new US administration to block “a wide range” of deals as part of Trump’s “America First” agenda.
MoneyGram shares fell 0.50 percent to US$16.81 at the close in New York. They have more than doubled in the past year.
Euronet chief executive officer Michael Brown wrote to Mnuchin this week arguing that Ant’s offer raises US national security concerns because money transmitters collect confidential data on users which the government requires them to retain for several years. Money transmitters also get confidential requests from the US Department of the Treasury’s Financial Crimes Enforcement Network about transactions that might be connected to terrorism or money laundering.
Yoder and Johnson reiterated those concerns in their letter on Friday, pointing out that Ant Financial is partly owned by Chinese state institutions. This could give a foreign government access to critical infrastructure and could be used for “intelligence purposes, location tracking and identifying vulnerabilities for coercion,” they said.
The total Chinese state-owned or state-affiliated ownership of Ant Financial is just below 15 percent, according to a person familiar with the matter.
Those investors are passive and the entities do not participate in Ant’s management or board, the person said.
Ant Financial, which has more than 630 million users and provides wealth management, insurance, credit checks and consumer loans, said it sought the CFIUS review.
“Ant will continue working with MoneyGram to obtain all required regulatory and shareholder approvals to successfully close the transaction later this year,” the company said in an e-mailed statement.
The transaction would not give the Chinese government access to personally identifiable information of Americans collected by MoneyGram in the US, and MoneyGram’s servers and data would stay in the US, the person familiar with the matter said.
Ant Financial also plans to keep MoneyGram’s headquarters, management team and employees in Dallas.
MoneyGram said it only collects and transmits a limited amount of personally identifiable information that is encrypted and stored at its facility in Minneapolis, Minnesota.
That process would continue under the agreement with Ant Financial to ensure “transactions are fully safeguarded and not misused or accessed by any government — including the Chinese government,” it added.
DEVELOPING TALENT: The electronics contractor is looking to recruit people to work in core tech fields and emerging industries like electric cars and robotics Hon Hai Precision Industry Co (鴻海精密), the world’s largest contract electronics maker, has launched a recruitment drive, offering a monthly salary of no less than NT$45,000 (US$1,485) to university graduates. For those with a master’s degree, the starting pay would be NT$52,000 per month at the minimum, while doctorate degree holders would receive at least NT$60,000 a month, Hon Hai said a statement issued early this week. The latest recruitment drive is aimed at attracting talent in core technology fields — artificial intelligence, semiconductors and next-generation mobile communications — and emerging industries — electric vehicles, digital healthcare and robotics, the
MRT TRAVEL FALLS: In February, ridership on the Taipei MRT System fell 8.96 percent from an average of 2.01 million per day in January Scooter sales jumped 13 percent last month as more commuters turned to two-wheelers to avoid public transportation amid the COVID-19 pandemic, the latest statistics showed. Sales expanded to 74,493 units last month, compared with 65,913 units in February, statistics released on Wednesday by Kwang Yang Motor Co (光陽工業) and the Ministry of Transportation and Communications showed. In the first quarter, aggregate sales slid 0.51 percent year-over-year to 186,627 units, from 187,580 units, data showed. Kwang Yang, the nation’s biggest scooter manufacturer, continued to lead the market by selling 24,136 vehicles last month, growing 6.12 percent from 20,785 units in the previous month, while
Asustek Computer Inc (華碩), the nation’s leading PC vendor, yesterday launched its first dual-screen gaming laptop powered by Intel Corp’s latest central processing units (CPUs). The PC manufacturer’s announcement closely followed the US chipmaker’s unveiling of its 10th Generation Core H-series, the fastest commercial mobile processors with speeds of up to 5 gigahertz. Although Asustek’s Zephyrus Duo 15, the highlight of its Republic of Gamers line, is not the company’s first laptop with two screens, it is its first designed specifically for gaming. Nestled between the primary display panel and the keyboard, the secondary display, which Asustek calls the ScreenPad Plus, is angled
NO ILL EFFECT: Last month’s data mainly reflected deals made in February, when the spread of COVID-19 was still relatively mild in Taiwan, housing brokers said Housing transactions in the six special municipalities totaled 19,824 units last month, up 7.8 percent from a year earlier, brokers said, citing government data. Last month’s data mainly reflected deals made in February, when the pinch of the COVID-19 pandemic was not yet evident, they said. Taoyuan posted the largest improvement, with housing transactions soaring 36.6 percent year-on-year to 3,676 units, local government data showed. Taiwan Realty Co (台灣房屋) attributed the pickup to the completion of two presale residential projects in the municipality. Houses in Taoyuan have increasingly gained in popularity in the past few year years due to relatively affordable home prices and