Chinese LED chipmaker’s purchase of Dutch firm collapses after US opposition

China’s leading LED chipmaker and its Malaysian partner have abandoned their US$239 million cash offer to purchase Dutch technology company Lumileds Holding after opposition from US authorities, marking the latest setback for Chinese tech investment overseas following the high-profile Nexperia saga. Sanan Optoelectronics, listed in Shanghai, said in a disclosure announcement on Friday that despite multiple rounds of discussions, the Committee on Foreign Investment in the United States (CFIUS) determined the transaction would pose “irresolvable US national security risks” and asked the firms to withdraw their filing and abandon the transaction. “Accordingly, on April 17, 2026, the parties submitted a letter to CFIUS withdrawing the filing and voluntarily abandoned the transaction,” the statement said. Under the share purchase agreement, regulatory clearance from all relevant domestic and overseas authorities was a closing condition. With CFIUS effectively derailing the deal, that condition could no longer be met, according to the firm. This is the second time a Lumileds sale to a Chinese buyer has collapsed following CFIUS opposition, highlighting the complex situation facing Chinese tech firms seeking global customers through acquisitions. “The company will continue to pursue its internationalisation strategy with resolve, and will press ahead in strengthening its competitiveness in the mid-to-high-end LED sector and in global markets,” Sanan said. The collapsed deal would not materially affect its finances or day-to-day operations, the firm added. In 2025, Sanan and Malaysian partner Inari Amertron Berhad announced their joint plan to purchase 100 per cent of Lumileds and its European and Asian subsidiaries, giving them access to the Dutch firm’s production facilities in Singapore and Malaysia and enabling them to “quickly secure overseas production bases, ensuring reliable supply” to international customers. “This is of significant importance for advancing the company’s globalisation strategy and expanding its overseas revenue scale,” Sanan said at the time. Washington has been tightening restrictions on Chinese technology entering its market. Last week, the US Federal Communications Commission said it was considering prohibiting Chinese telecoms operators from running data centres in the country, while also restricting their access to US networks and infrastructure. This is not the first time CFIUS has blocked a Chinese attempt to acquire Lumileds. In 2015, Philips announced plans to sell 80.1 per cent of the company to a consortium led by Chinese private equity firm Go Scale Capital for US$3 billion. In January 2016, the deal was blocked by CFIUS, reportedly citing concerns about Chinese control over dual-use semiconductor technology involved in making LEDs. Despite “persistent attempts” from both companies to make the case for the deal, “all such efforts fell short of addressing unexplained government concerns”, Go Scale Capital said at the time. The company was eventually acquired by US-based Apollo Global Management in a leveraged buyout, which left Lumileds with heavy debt. That ownership period culminated in Lumileds filing for Chapter 11 bankruptcy in 2022. The company used a pre-packaged restructuring process to eliminate around US$1.3 billion in debt across its US and Dutch entities, citing “ongoing challenges presented by global supply constraints, Covid-19-related issues, and the crisis in Ukraine”, according to then-CEO Matt Roney. The newly abandoned takeover comes as business ties between Beijing and The Hague remain strained from the ongoing Nexperia saga. Relations between Nexperia and its Chinese owner Wingtech are tense as the Dutch Enterprise Chamber investigates the firm’s management under former CEO Zhang Xuezheng. Wingtech held a first meeting with the new Dutch government but no breakthrough was achieved, sources told the South China Morning Post. The Dutch government has also held talks with senior Chinese officials, but no solution has emerged.