President Donald Trump will decide in the next two weeks whether to block a Chinese-backed private equity firm from buying a U.S. chip maker, putting his economic and diplomatic relations with China under a spotlight.
Lattice Semiconductor Corp. said in a filing Friday it will seek Trump's approval for its proposed $1.3 billion sale to Canyon Bridge Capital Partners, gambling that the former real estate dealmaker will approve the tie-up against the advice of the Committee on Foreign Investment in the United States (CFIUS), which scrutinizes foreign deals for national security concerns.
The decision, which the filing said will be made by the White House in the next 15 days, comes at a sensitive time. Relations are already strained between Washington and Beijing over trade and North Korea, and the Chinese communist party is preparing to hold its once-every-five-years congress next month.
The odds are not good for Lattice. If Trump approves the transaction, it would be unprecedented. U.S. presidents, who have the final authority on such investments, have always sided with CFIUS
Lattice makes chips known as field programmable gate arrays, which allow companies to put their own software on silicon chips for different uses. It no longer sells chips to the U.S. military, but its two biggest rivals, Xilinx Inc. and Intel Corp.'s Altera, do.
The United States is also concerned about China's ability to acquire technologies with potential military applications. The U.S. Department of Defense has raised concerns about the Lattice acquisition, two U.S. officials said on the condition of anonymity.