Trump blocks sale of US semiconductor company to Chinese firm

US President Donald Trump has blocked the proposed USD 1.3 billion acquisition of an American semiconductor company to a Chinese government- financed firm, citing national security concerns, the White House has said.

A federal panel that reviews foreign investment in the US for possible security threats ruled against the proposed USD 1.3 billion purchase last week of lattice Semiconductor, a Portland, Oregon-based company.

In his executive order, Trump said that lattice and Canyon Bridge "shall take all steps necessary to fully and permanently abandon the proposed transaction", within 30 days.

"Credible evidence leads me to believe" the buyers of lattice "might take action that threatens to impair the national security of the United States".

lattice is a publicly traded company headquartered in Oregon that manufactures semiconductors for the consumer, communications, and industrial markets.

Trump made the decision under Defence Production Act which authorises him to suspend or prohibit certain acquisitions that result in foreign control of an American business, White House Press Secretary Sarah Sanders said said.

Trump reached on this decision after considering several factors and a review of a recommendation from the Committee on Foreign Investment in the US.

"The national-security risk posed by the transaction relates to, among other things, the potential transfer of intellectual property to the foreign acquirer, the Chinese government's role in supporting this transaction, the importance of semiconductor supply chain integrity to the US government, and the use of lattice products by the US government," Sanders said.

US Treasury Secretary Steven Mnuchin welcomed Trump's decision. He is also the chairman of Committee on Foreign Investment in the United States (CFIUS).

"CFIUS and the President assess that the transaction poses a risk to the national security of the US that cannot be resolved through mitigation," Mnuchin said.

"The national security risk posed by the transaction relates to, among other things, the potential transfer of intellectual property to the foreign acquirer, the Chinese government's role in supporting this transaction, the importance of semiconductor supply chain integrity to the US government, and the use of lattice products by the US government," Mnuchin said.