The German government says it withdrew permission for a Chinese company to purchase semiconductor equipment company Aixtron due to security concerns.
Germany announced Monday that it was reconsidering the takeover bid by China's Fujian Grand Chip but didn't state a reason.
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Confirming German media reports, Economy Ministry spokeswoman Tanja Alemany said Wednesday that "security-related questions arose" that prompted the U-turn.
She declined to elaborate, but confirmed that the government would in principle take into account information received from foreign intelligence agencies when making such a decision.
German business daily Handelsblatt reported, without naming sources, that Germany was warned by U.S. intelligence that Aixtron's technology could be used for military purposes.
Fujian Grand Chip had bid 670 million euros ($737 million) for Aixtron.