U.S. Blocks a Chinese Deal Amid Rising Tensions Over Technology

United States officials have torpedoed a Chinese state-backed group’s plan to buy an American electronics company, signaling the Trump administration’s continuing skepticism toward Chinese investment deals, particularly those that involve transferring technological know-how.

Xcerra, a Massachusetts-based provider of equipment for testing computer chips and circuit boards, said this week that it was withdrawing from its $580 million sale to an investment group backed by a Chinese government-controlled fund.

The reason, according to Dave Tacelli, Xcerra’s president and chief executive, was that the deal was not likely to be approved by the Committee on Foreign Investment in the United States, a multi-agency Washington panel that operates largely out of the public eye. The committee, known as Cfius, plays an advisory role to the president, but it can effectively block foreign acquisitions of American companies over national security concerns.

The intensified scrutiny comes as China’s government is ramping up a plan, called “Made in China 2025,” to use state support and overseas acquisitions to dominate high-tech fields such as big data, advanced robotics and electric cars.

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