China-based Ant Financial will make a third attempt for approval from the U.S. to acquire MoneyGram International Inc., as road blocks have been put up by a secretive national security group for investors from China looking to buy U.S. companies.
Ant Financial was previously an affiliate of Alibaba Group Holding and is preparing to resubmit yet again its $1.2 billion offer for review before the United States Committee on Foreign Investment (CFIUS), said those familiar with this situation who requested to remain anonymous.
This underscores the troubles buyers from China face in trying to convince the panel investigating foreign acquisitions to give its approval.
President Donald Trump during this week killed the purchase of Lattice Semiconductor by an investment fund in China, which went before CFIUS on three occasions and never winning approval.
The panel currently is considering two or more other big deals that involve people or businesses from China acquiring U.S. companies.
Ant could not gain security clearance from the panel for its deal to acquire MoneyGram that was announced back in January, following an initial review of 75 days.
On Friday, a prepared statement by Ant was emailed to media that said the company would not comment on the process of CFIUS, but it continues working with regulatory agencies and is focused on closing the MoneyGram transaction by the end of 2017.
A MoneyGram spokesperson did not comment when a request was made. The CFIUS reviews are confidential and no comments are made by the panel on the work it does.
The prolonged process has come amidst heightened tensions politically. The White House has upheld its hard line against takeovers by Chinese businesses of U.S. companies even as it is seeking the aid by China to resolve the nuclear crisis in North Korea.
Shares of MoneyGram were down 1.2% in trading on Friday.
Ant is a giant in China. It provides services from insurance to wealth management to consumer loans and credit checks.
Two House of Representative members have urged the secretive panel to conduct full and thorough investigations of deals involving Chinese companies including this one.
They argue this deal could give access to China of critical financial infrastructure in the U.S.
Ant disputes the assertions that the security of the U.S. would be compromised, as it cited plans it has to maintain the headquarters of MoneyGram, its employees and management team in place in Dallas.