Micron Technology Inc has told China’s Tsinghua Unigroup Ltd [TSHUAA.UL] that its $US23 billion acquisition offer is not realistic because U.S. authorities would block the deal due to national security concerns, according to people familiar with the matter.
The Boise, Idaho-based chipmaker thinks that an acquisition by Tsinghua would not be approved by the U.S. inter-agency task force called the Committee on Foreign Investment in the United States (CFIUS), which has the power to stop mergers that might endanger national security, the people said on Monday.
By the end of last week, Tsinghua had communicated its interest to Micron about an acquisition but had not presented a formal offer, according to the people.
Micron has sought advice from an investment bank but has not officially hired one since it is not seriously considering Tsinghua’s offer, the people said. Micron may decide to retain a bank in the future if Tsinghua presses on with its offer, the people added.
The sources asked not to be identified because the deliberations are confidential. Micron and Tsinghua declined to comment.
(Reporting by Liana B. Baker and Greg Roumeliotis in New York; Additional reporting by John Ruwitch in Shanghai, Gerry Shih in Beijing and Diane Bartz in Washington; Editing by Andrew Hay)
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