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US gov't may axe Lenovo-IBM deal


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Posted

http://www.atimes.com/atimes/China/GA25Ad03.html

Well, here we were celebrating the growth of China’s global brands and possibly jumped gun. The US government is mulling annulling the Lenovo/IBM PC marriage before it is consummated over apparent national security concerns. They believe the IBM facilities, particularly one in North Carolina, may make it easier for Chinese Lenovo employees to conduct espionage. One of the big concerns is the majority ownership in Lenovo by the Chinese government (via the Chinese Academy of Sciences).

I have heard other concerns were raised similar to this in the Chinese mineral company Minmetals attempting to buy the largest Canadian mining firm Noranda. Though the complaints there had a human rights bent as well.

What do I think? I still need more information. I can understand there is a rational national security concern, however, no one knows what kind of politics or economic wrangling may be happening behind closed doors. There were similar concerns with Taiwanese semiconductor companies opening plants on the mainland. Many make sensitive components for US defense and there were fears of leaks. Would a no on the Lenovo deal make China retaliate using the WTO to complain or tightening its own rules on MNCs in China?

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