Companies Disclose CFIUS Notifications, Approvals
Several companies disclosed their filings with the Committee on Foreign Investment in the U.S. or updated the status of their ongoing CFIUS reviews this month. The filings describe one CFIUS notification involving a Taiwanese technology company, three CFIUS clearances, a transaction involving a U.S. email encryption company and more.
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Taiwan-based Foxconn, an electronics manufacturer, is awaiting CFIUS approval to acquire a facility belonging to Ohio-based Lordstown Motors, an electric truck manufacturer, according to Lordstown's Securities and Exchange Commission filing. The companies are awaiting a CFIUS determination about whether the purchase is a “covered transaction” or whether the committee determines it has “no national security concerns,” according to the filing. If the deal is “terminated” because Foxconn can’t meet CFIUS mitigation conditions, the Taiwanese manufacturer will pay Lordstown a $2.3 million fee.
South Korea’s DL Chemical, a petrochemical company, recently received CFIUS clearance to purchase Kraton, a synthetic rubber manufacturing company, according to Kraton’s SEC filing. The companies entered into the agreement Sept. 27 and received clearance Nov. 17, the filing said. They expect to complete the transaction by the end of the first half of 2022.
In another filing, ESS Tech, a U.S. battery manufacturer, received CFIUS clearance to become a publicly listed company. ESS Tech said its “business combination” closed Oct. 8 and it received CFIUS clearance Oct. 28. The committee said “there were no unresolved national security concerns with respect to the” transaction.
Canada-based Open Text, an information management solutions company, and Texas-based Zix, a cloud email security provider, are preparing to submit a notification to CFIUS, according to an SEC filing. Under the deal, Zix would be acquired for about $860 million. The companies plan to submit a joint voluntary declaration “as soon as reasonably practicable.”
U.S.-based TuSimple Holdings, which provides self-driving truck technology, is the subject of a CFIUS review involving a four-year-old transaction involving Chinese technology company Sina (see 2108160020). Although CFIUS hasn’t yet advised either company about whether it will approve the deal, TuSimple recently said it’s confident CFIUS will soon make a determination. “We believe that we are moving closer to resolution, but have not yet reached a definitive outcome of the process as of this date,” the company said in a filing.
Computer security company McAfee is being acquired by an investor group led by Advent International, Permira Advisers, Crosspoint Capital Partners, the Canada Pension Plan Investment Board, GIC Private and a subsidiary of the Abu Dhabi Investment Authority, the company announced this month. The parties plan to submit a voluntary notice to CFIUS, according to an SEC filing, and to cooperate with any CFIUS “request for additional information, documents or other materials.” McAfee added that the “parties shall undertake best efforts to promptly take, or cause to be taken, all action, and do, or cause to be done all things necessary or advisable to obtain CFIUS Approval as soon as practicable.”