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The Morning Risk Report: Security Concerns Quash Sale of German Company |
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The government of German Chancellor Angela Merkel, who is seen here at the Max Planck Institute of Plasma Physics in Greifswald, Germany, in February 2016, this week rejected for the first time the sale of a German company to a Chinese suitor on security grounds. PHOTO: Adam Berry/Getty Images
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The German government has decided to ban for the first time the sale of a German company to a Chinese suitor on security grounds, an official from the German ruling coalition parties said Thursday.
The decision to block the sale of machine tool company Leifeld Metal Spinning AG to a Chinese investor came after an extensive review that led the government to the conclusion such a transaction would be a “risk to public order and safety,” WSJ's Andrea Thomas reports, citing the official, who declined to be named.
The move illustrates how concerned Germany is about growing appetite for German technology, which analysts say is a key factor behind the strength of Germany’s export-reliant economy.
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The veto was made possible after the German government adopted legislation last year to make it easier to veto takeovers of strategically important companies if the investment puts the public order or safety at risk. The move effectively—though not nominally—targets China’s attempt to acquire key technology.
The new rules apply mainly to targets in the defense sector and developers of critical software powering financial and telecommunications services, public transport or power grids.
German officials have repeatedly voiced frustration over a situation in which China can buy high-tech expertise in Germany’s open market, then use that know-how to build protected champions on its own markets.
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The Consumer Finance Protection Bureau, after pausing the policing of financial firms under Trump-appointed leadership, has restarted enforcement using a more collaborative approach than in the Obama era, WSJ reports. Critics say some of the bureau’s recent settlements show companies are getting away with less stringent penalties than during the Obama administration.
The acting head of the Environmental Protection Agency is reversing a policy of his predecessor Scott Pruitt and says the agency will enforce tighter pollution emission limits on certain types of freight trucks, Washington Post reports. New York Times reports Andrew Wheeler also is trying to keep President Trump from implementing a plan to allow automobiles to emit more pollution.
The Chinese regulator that rejected Qualcomm Inc.s takeover attempt of NXP Semiconductors said it remains open to further talks with Qualcomm about the deal, which it rejected on antitrust concerns, Reuters reports.
Aviation industry experts are finalizing rules that will enable some airliners to routinely take off in significantly lower visibility than currently permitted at most U.S. airports. The anticipated new standards will allow departures with only one-third or half the 1,000-foot minimum visible runway distance typically required for liftoff, WSJ reports.
The U.S. Commerce Department deflected a congressional committee’s concerns it is doing an insufficient job stopping U.S.-made technology from playing a role in oppressive policing in China., WSJ reports.
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U.S. Sen. Claire McCaskill, (D-Mo.), says Russian government hackers tried but failed to break into her Senate computer system, Washington Post reports. A Microsoft Corp. executive speaking at a security conference last week said Russia's GRU spy agency also tried to get into the system's of two other candidates running in midterm elections in addition to the senator's network.
The American Civil Liberties Union says a test of facial-recognition technology made by Amazon.com Inc. mistakenly identified 28 members of Congress as people who had been arrested for a crime, New York Times reports. Amazon said the ACLU used the technology in a different way than it recommends law enforcement agencies use it.
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Papa John’s International Inc.’s founder John Schnatter is taking his first legal action against the pizza chain since relations with his board of directors began crumbling. WSJ reports Mr. Schnatter, who owns 29% of Papa John’s and is a director, filed a complaint against Papa John’s in a Delaware court on Thursday alleging the company failed to disclose documents he requested related to his resignation as chairman. A spokeswoman for Papa John’s said the company believes it has given him all of the documents he is entitled to.
Top officials at a Malaysian sovereign-wealth fund said they would resign en masse, signaling Prime Minister Mahathir Mohamad’s resolve to shake up senior civil-service ranks following his election in May, WSJ reports. The managing director and entire board offered their resignations to “facilitate a smooth and orderly transition,” the fund said in a statement.
Discord and drama have engulfed Univision Communications Inc., the nation’s largest Spanish-language broadcasting outletl, WSJ reports. Like most media companies, it is facing fundamental challenges brought on by entertainment’s shift to the internet, including a steep decline in cable TV subscribers. Also, top executives and board members have feuded over almost every aspect of Univision’s future.
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Vehicles drive past Univision Communications Inc. headquarters in Los Angeles in June 2006. PHOTO: Tim Rue/Bloomberg News
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European officials on Thursday hailed a deal with the U.S. to avert a trade war despite a lack of details that could derail the vague accord and upend efforts to resolve outstanding issues. WSJ reports the Trump administration on Thursday touted its truce with Europe to nervous lawmakers as evidence its trade policies are starting to show results, but Republicans pushed the administration to accelerate efforts to find similar solutions on other trade fronts.
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A federal judge removed five banks from two antitrust lawsuits alleging they helped to rig prices in gold and silver markets, Reuters reports. The banks dismissed from lawsuit include Bank of America Corp., Barclays Plc, BNP Paribas SA, Standard Chartered Plc, and UBS Group AG.
Walmart Inc. tabbed Capital One Financial Corp. as the new issuer of its store credit card, according to people familiar with the matter, ending a nearly 20-year partnership with Synchrony Financial, WSJ reports. Losing Walmart is a major blow to Synchrony, the largest U.S. store-card issuer. Walmart accounts for about 19% of Synchrony’s store-card portfolio.
Normally teeming with tourists this time of year, Yosemite National Park is now a no-man’s land as smoke from a raging forest fire cloaks the park and its most famous attractions. WSJ reports it is the first time a fire has shut down the area since 1990, damping the region’s economy during peak season and casting out tourists who have journeyed here from across the globe.
A labor union representing workers at Hyundai Motor Co.'s plants in South Korea says its members approved a tentative agreement to raise their pay, Reuters reports, while a trucking strike in India is slowing deliveries from e-commerce companies.
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German auto manufacturer Daimler AG is considering shifting production of some Mercedes Benz models out of the U.S. as a way to protect itself against fallout from the trade spat between the U.S. and China, Reuters reports. Mercedes sport-ulity vehicles now built in Alabama face tariffs when they are exported to China, so the company may look to build them in Asia to avoid the surcharges.
After spending the past few years chasing after millennials, J.C. Penney Co. executives say they are now focused on wooing another elusive group: middle-aged moms, WSJ reports. The shift is the latest about-face for a retailer that has veered from one strategy to the next as it has cycled through three chief executives in nearly seven years.
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Shoppers at the JC Penney at the Columbia Mall in Bloomsburg, Pa., in July 2017. PHOTO: Don Emmert/Agence France-Presse/Getty Images
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MiMedx Group Inc. said Thursday the Nasdaq Stock Market has notified the company it faces a possible delisting of its shares, WSJ reports. The notification came after MiMedx informed the stock exchange it won't file audited financial statements with the Securities and Exchange Commission by a required deadline next month.
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Macquarie Group Ltd.’s is promoting Shemara Wikramanayake to chief executive—a rare example of a female running an investment bank, WSJ reports. The 56-year-old Australian joins a narrow band of female leaders of Australia’s 200 largest listed companies, and becomes one of the most powerful women in world of finance.
Beth Ford was named president and chief executive at Land 'O Lakes Inc. and will replace the retiring Chris Policinski, St. Paul Business Journal reports. Ms. Ford has been chief operating officer of the company's business division.
Mitch Barnes said he will retire at the end of the year as chief executive at consumer-data company Nielsen Holdings PLC, Bloomberg reports.
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Follow the WSJ Risk & Compliance Team on Twitter: @WSJRisk, @srubenfeld, @BenDiPietro1 and @LikelyMara.
Send complaints, comments and kudos to Ben DiPietro at ben.dipietro@wsj.com.
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