DP World selling U.S. assets to AIG
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DP World selling U.S. assets to AIG
KAI RYSSDAL: Dubai Ports World is back in the news. You may recall the company caused quite a stir last winter when it took over operations at six US ports. Today DP World announced it’s selling its US assets to insurance giant American International Group. Marketplace’s Amy Scott has more.
AMY SCOTT: It was back in February that DP World bought the British port operator P&O. Then Congress threatened to scuttle the deal over security concerns, and the company agreed to hand over its U.S. assets to an American firm. The deal with AIG is worth an estimated $700 million. Retired Coast Guard officer Stephen Flynn says the ports aren’t necessarily safer in American hands. Port security requires international cooperation. And DP World is the third-largest port operator on Earth.
STEPHEN FLYNN: And so the extent to which we ended up kicking in the teeth one of the important players in this industry, that was not a big step forward in my view in terms of national security.
The controversy also may have chilled international investment. When the foreign purchase of a U.S. firm raises any national security concerns, a government panel has to approve the deal. That panel is the Committee on Foreign Investment in the United States, or CFIUS. Attorney David Marchick says filings with the committee are up almost 50 percent this year. Not because more companies pose a threat, but because they’d like to avoid getting the same kind of snub given to DP World.
DAVID MARCHICK: I’m filing European acquisitions and other acquisitions of U.S. companies which aren’t particularly sensitive. But just to be cautious, companies are filing with CFIUS whereas a year ago they wouldn’t.
But then CFIUS had approved the Dubai deal before Congress got wind of it. Marchick says these days the panel reviews transactions far more carefully.
In New York, I’m Amy Scott for Marketplace.
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