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U.S. company sues China's HNA over deal, cites opaque ownership

12/12/2017| 2:18:02 PM| 中文

U.S. software engineering company Ness Technologies has sued Chinese conglomerate HNA Group accusing it of failing to adequately answer questions about its ownership.

Ness Technologies S.A.R.L., a U.S. software engineering company, has sued Chinese conglomerate HNA Group accusing it of failing to adequately answer questions about its ownership in a U.S. review of takeovers by foreign companies, thereby causing their USD 325 million deal to fail.

The lawsuit by New Jersey-based Ness is the latest case involving HNA, which has come under U.S. and European scrutiny after a USD 50 billion worldwide acquisition spree that included stakes in Deutsche Bank and Hilton Worldwide Holdings Inc.

HNA is part of a consortium that agreed in January to buy a majority stake in SkyBridge Capital LLC, a U.S. hedge fund investment firm founded by Anthony Scaramucci, a former aide to U.S. President Donald Trump.

In the lawsuit filed last week in the Supreme Court of the State of New York, Ness claimed that HNA had caused it financial harm by not using what it called “best efforts” to get regulatory approval for its takeover of a Ness unit.

HNA’s Beijing-based subsidiary, Pactera Technology International Ltd, had agreed in March to buy Ness’ unit, Jersey Holding Corp, according to the court filing.

The deal needed a greenlight from the Committee on Foreign Investment in the United States (CFIUS), an intra-government agency that scrutinizes for national security concerns foreign groups’ purchases of U.S. assets.

According to the lawsuit, between July and October, CFIUS sent HNA and Pactera at least 77 follow-up questions about its ownership and shareholding structure pertaining to HNA’s takeover of Jersey Holding as well as SkyBridge Capital.

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TAGS: HNA | Ness | GFIUS
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