US blocks China fiber optics deal over national security

The Obama administration has forced a US maker of fiber optics to abandon a planned joint venture with China's Tangshan Caofeidian Investment Corporation because it believes the tie-up would threaten national security.

The decision by the White House to scupper the move represents the second time in less than a year that the administration has sought to block a transaction involving a Chinese company because of security concerns. It also offers a rare glimpse into the administration's handling of sensitive acquisitions following a drought in cross-border deals during the financial crisis. Emcore, which is based in New Mexico and makes components for fibre optics and solar panels, said in a statement it had withdrawn a voluntary filing with the Committee on Foreign Investment (Cfius) after the executive branch panel said it had "regulatory concerns" over the venture. Cfius, which is chaired by the Treasury department, conducts classified investigations of deals on national security grounds.