China LED chip maker Sanan Optoelectronics’ acquisition of Dutch technology company Lumileds Holding has fallen through after objections from U.S. authorities. The U.S.-China technology dispute is affecting acquisitions of European companies, highlighting renewed uncertainty in the global mergers and acquisitions environment.
On April 17, the South China Morning Post in Hong Kong reported that Sanan Optoelectronics’ Malaysian partner Inari Amertron Berhad withdrew a $239 million all-cash offer. The decision came after the Committee on Foreign Investment in the United States opposed the deal, citing “unresolvable national security risks”.
In a regulatory filing, Sanan Optoelectronics said CFIUS asked for the review application to be withdrawn and the deal to be abandoned. It said both sides accepted and officially halted the acquisition process. The deal was pursued as a strategic investment to secure overseas production bases and strengthen the global supply chain.
Sanan Optoelectronics earlier announced it would acquire 100 percent of Lumileds and its European and Asian subsidiaries in 2025. It presented plans to boost its ability to serve global customers by securing production facilities in Singapore and Malaysia. The company previously stressed the acquisition would be an important turning point for expanding overseas sales and its globalisation strategy.
The deal could no longer proceed after failing to secure approvals from regulators in each country, a required condition under the acquisition contract. Sanan Optoelectronics said the withdrawal would not have a significant impact on its financial condition or day-to-day operations. It added it would continue efforts to strengthen competitiveness in the mid- to high-end LED market and pursue its global strategy.
This is not the first China-linked attempt to acquire Lumileds. When Philips sought to sell its stake in 2015, a Chinese private equity consortium attempted to acquire the company, but the deal was blocked in 2016 by CFIUS. U.S. authorities were reported at the time to be concerned about potential leakage of dual-use semiconductor technology used in LED manufacturing.
Lumileds was later acquired by Apollo Global Management, but it pursued restructuring after filing for bankruptcy protection under Chapter 11 of the U.S. bankruptcy law in 2022 amid a heavy debt burden. Analysis followed that disruptions to global supply chains and geopolitical risks added to management pressures.
The case shows the United States has stepped up its checks on overseas acquisitions by Chinese technology companies. The U.S. Federal Communications Commission has also maintained its regulatory stance, including reviewing restrictions on Chinese telecommunications operators running data centres in the United States.
Related tensions are also continuing in Europe. In the Netherlands, a dispute involving Nexperia and its parent Wingtech remains unresolved as corporate governance and security issues overlap.
The failed deal is seen as an example of the U.S.-China technology rivalry affecting the European market beyond bilateral ties. The trend of Chinese companies’ global expansion strategies being heavily influenced by national security reviews and diplomatic variables is likely to persist for some time.
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