Hutchison subsidiary Hutchison Telecommunications Ltd and Singapore Technologies Telemedia Pte Ltd agreed a deal with a US bankruptcy court in August 2002 under which they would pay $250m for a 61.5% stake in bankrupt Global Crossing. However, the deal has been questioned by the Committee on Foreign Relations in the United States, which can block overseas takeovers of US companies on security grounds.
While officially Hutchison has little to say over the deal, indications are that it would be prepared to be a passive investor and allow the four seats that it could be expected to take on the board to be filled by people approved by the US government.
The issue was raised last week when IDT Corp launched a belated, competitive bid, and company chairman Howard Jonas questioned how a foreign telecommunications company, based in communist-controlled China could gain control over a company that would give them access to some of our government’s and major corporations’ most sensitive phone conversations.
Source: Computerwire
