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WASHINGTON, April 28: President George Bush on Friday approved a Dubai-owned company’s $1.24 billion takeover of Doncasters, a British engineering company with US plants that supply the Pentagon, the White House said on Friday.
The decision followed a congressional uproar over security fears that scuttled another Dubai state-owned company’s plan to acquire operations at major US ports.
A leading opponent of that earlier deal, Senator Charles Schumer, said he would not oppose the Doncasters transaction.
Among the Doncasters’ holdings is a plant in Georgia that is the sole supplier of turbine fan parts for the US Abrams main battle tank manufactured by General Dynamics Corp’s Land Systems unit. The company manufactures precision-engineered parts for a variety of industries including aerospace, gas turbine and petrochemical companies.
The interagency Committee on Foreign Investments in the United States sent its confidential recommendation on the Dubai takeover of Doncasters to Bush two weeks ago.
“The committee recommended approval of the transaction after closely scrutinizing it and concluding that it would not compromise our national security,” White House spokesman Scott McClellan said. He said that Bush accepted the panel’s recommendation on Friday morning.
CONDITIONS: As one condition of the deal, the company signed an additional agreement with the Pentagon to provide assurances on keeping military technology in the United States.
By attaching such a condition to the agreement, the administration was attempting to head off the kind of controversy that erupted over Dubai Ports World’s bid to manage six US ports.
In the ports dispute, Bush found himself sharply at odds with members of his own Republican party, who were angry they had not been consulted over a contract they said had obvious security implications.
Schumer, a New York Democrat, said in a statement on Friday that the Doncasters’ deal was different, because it was carefully considered and involved products — not services that might have been easier to “sabotage.”
“Unless new information comes out, I will not oppose this deal,” the New York Democrat said in the statement.
Congress openly defied the administration’s approval of the ports deal and as a result, Dubai Ports World said last month it would transfer the U.S. terminal operations it had just acquired to a U.S. entity.
With the Doncasters transaction, officials said the Bush administration had sought to be more inclusive of Congress, with Pentagon and Treasury officials having briefed members recently.
Still, there was likely to be some concern from lawmakers, and it was unclear whether the conditions Bush was attaching would quiet Democratic critics.—Reuters
