Germany blocks takeover of satellite firm IMST by Chinese defence firm
09 December 2020
Germany has blocked the takeover of satellite and radar technology firm IMST by China Aerospace and Industry Group (CASIC),China’s a subsidiary of state-controlled missile manufacturer, on national security concerns, a government document showed on Tuesday.
IMST GmbH, Germany is a research-driven industrial engineering and design house specialising in radio technologies and microelectronics.
Our target customers range from small companies to international corporations. Our goal is complete customer satisfaction.
Germany’s relations with China have lately soured with increasing trade tensions over unfair competition by state-backed Chinese enterprises and restrictions on market access.
IMST is an important provider of satellite communication, radar and radio technology, and its know-how is crucial for national security, according to documents with German government.
IMST is also needed for necessary technology in the construction of critical infrastructure in the future, including 5G and 6G networks.
“IMST is also an important partner of the German Aerospace Center (DLR). In various cases, IMST’s products and services were also the subject of deliveries to the Bundeswehr armed forces,” says the document.
While China is naive to open its market to foreign products and firms, reports citing Chinese foreign ministry sources said Beijing is unaware of the developments, but that the government always encourages Chinese companies to carry out “mutually beneficial” investments overseas.
“We hope that countries, including Germany, will provide Chinese companies that are operating normally with a fair, open and non-discriminatory market environment, and not politicise normal economic and trade cooperation, (or) use ‘national security’ as a pretext to engage.
Germany has lowered the threshold for screening and even blocking purchases of stakes in German firms by non-Europeans in a move to fend off unwanted takeover attempts mainly by state-backed Chinese investors in strategic areas.
Under the new rules, Berlin can intervene on grounds of public interest if a non-European investor buys a 10 per cent stake in a company, against 25 per cent earlier.
There have been several Chinese attempts to take over German firms, including a proposed takeover of toolmaker Leifeld and power grid operator 50Hertz in 2018.
In August, the government rejected a bid by China’s Vital Materials Co to buy PPM Pure Metals, which supplies to the German military.