Shenzhen Energy is latest Chinese firm forced to give up on US acquisition after falling under scrutiny
Its subsidiary Shenmei Energy Investment had planned US$232 million purchase of projects run by Recurrent Energy Development, but was blocked by the Committee on Foreign Investment in the US
Shenzhen Energy Group, the southern Chinese city’s largest power producer, has been dealt a setback in its overseas expansion plans after failing to gain approval from US regulators for a planned major solar power acquisition.
Its US subsidiary Shenmei Energy Investment Holdings last year agreed to buy three firms owning projects being run by Recurrent Energy Development Holdings for US$232 million.
But it has now failed to obtain clearance from the US’ Committee on Foreign Investment (CFIUS), 10 months after it first was announced, Shenzhen Energy said in a filing to the Shenzhen Stock Exchange on Wednesday.
It is the latest in a string of US asset acquisitions by Chinese firms thwarted by CFIUS – an inter-department government body tasked with vetting deals supposedly in an effort to protect US national security interests.
The withholding of CFIUS consent comes amid escalating Sino-US trade tensions, and is also despite the solar farm projects involved actually already being backed by Nasdaq-listed Canadian Solar, a Chinese-financed solar panels manufacturer and major solar farm developer.
The deal is not considered as involving the deployment of what might be considered nationally sensitive technology.
