U.S. Government Is 'Comfortable' With Foreign Takeover Of Fairchild Semiconductor, Source Says

The New York Post reported on Tuesday that Fairchild Semiconductor Intl Inc FCS is prepared to accept a $2.5 billion takeover offer from China Resources Microelectronics and Hua Capital Management. Fairchild confirmed last month it received an unsolicited offer to be acquired for $21.70 per share from the Chinese firms. Typically speaking, a foreign takeover of a U.S. firm, especially a Silicon Valley and high tech firm, is heavily scrutinized by U.S. regulators. Nevertheless, the U.S. Committee on Foreign Investment (CIFUS) still needs to give the final seal of approval on the deal. Shares of Fairchild Semiconductor spiked to an intra-day high of $20.80 on Tuesday and was trading higher by more than 1 percent at $20.66 heading into the closing bell. "Sources'" have told the New York Post that the U.S. government would be "comfortable" with the acquisition as the Chinese buyers acquire "basic technology" and a "low-margin business." By comparison, the CIFUS blocked a deal in which Philips planned on selling a majority stake in its California-based LED business to foreign investors, including firms from China. In this case, the LED business develops technology for military applications.