WASHINGTON — The Bush administration has approved a takeover by the
United Arab Emirates of a leading subcontractor for the U.S. military.
President Bush has endorsed a recommendation of the Committee on Foreign
Investment in the United States for a UAE state-owned company to acquire the
British-based Doncasters Group. Doncasters, with nine factories in the
United States, has produced components for aircraft and main battle tanks.
"I am convinced [by] the recommendation of the CFIUS committee as well
as
our military that it is a sale that should go through," Bush said on April
28.
CFIUS, an agency under the authority of the Treasury Department,
recommended the $1.24 billion takeover of Dubai International Capital of
Doncasters after a 45-day review that ended on April 13. The recommendation
was then relayed to Bush, who had until April 28 to decide.
"This was a transaction that was thoroughly reviewed and closely
scrutinised," White House press secretary Scott McClellan said. "In the view
of the committee, it does not compromise our national security."
As part of the administration approval, Dubai International signed an
agreement that promised an uninterrupted supply of spare parts to the U.S.
military, McClellan said. He said the UAE firm was also committed to keeping
military technology in the United States.
Doncasters has been deemed the sole supplier of turbine fan parts for
the U.S.-origin M1A2 main battle tank. The company was also said to be a
supplier of components for the F-35 Joint Strike Fighter.
"This [CFIUS] investigation was a significant improvement over what
happened
before," House Homeland Security Committee chairman Peter King said. "It's
been much more thorough, much more detailed."
This was the second deal approved by the administration of a UAE
takeover of what some members of Congress regarded as a vital U.S. asset. In
March, Bush approved a UAE takeover of the operations of six major U.S.
ports. After threats from Congress to outlaw the deal, the UAE firm, Dubai
Ports World, announced plans to transfer port operations to an American
company.
"There are two differences between this deal and the Dubai Ports deal,"
Sen. Charles Schumer, a New York Democrat who opposed the port deal, said.
"First, this went through the process in a careful, thoughtful way; and
second this is a product not a service and the opportunity to infiltrate and
sabotage is both more difficult and more detectable."
