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A court in Rotterdam recently ruled that Dutch-based tech company Anteryon was not required to report a change in majority ownership to the Ministry of Economic Affairs. The decision contrasts with the minister’s concerns about the acquisition of Anteryon by Chinese company Jingfang Optoelectronics.

Anteryon develops lenses, lasers, and optical systems and counts ASML among its clients. In 2019, the company was sold to Jingfang, which had another majority shareholder at the time. Because of a recent buyout, the chip company China Wafer owns most of Jingfang’s shares.

Concerns about change in majority shareholder

Minister Adriaansens of Economic Affairs recently expressed concerns about this transaction, stating that it may pose a risk to national security. She did not disclose the exact nature of these risks, but in any case, the minister felt that Anteryon should have reported the buyout. Anteryon disagreed and went to court, reports Dutch financial daily newspaper FD.

Anteryon CEO Gert-Jan Bloks stressed that the company’s technology had no military application and no sensitive or unique features. Nevertheless, the acquisition was an important part of Anteryon’s growth strategy at the time, mainly because of the possibility of setting up large-scale production in China. Jingfang paid between 40 and 50 million euros for the Eindhoven-based company. Anteryon has about 180 employees and is a former Philips unit that became independent in 2006.

Strategic knowledge in the wrong hands

The case revolves around a set of regulations that was introduced last year, precisely to prevent strategically important knowledge and companies from falling into the wrong hands (Read: China). Minister Adriaansens believed that under this law, Anteryon should have reported the change in shareholders, but the court ruled otherwise.

The ruling is a setback for the minister, who is considering next steps. The development also highlights broader concerns about Chinese takeovers of technology companies in the Netherlands and elsewhere in Europe, such as previously in the case of the Delft chip start-up Nowi, although that investigation ultimately did not warrant action. So far, the ministry has not reversed or prohibited any takeovers.

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