The UK government blocked the acquisition of UK group Pulsic by Hong Kong company Super Orange HK on national security concerns on Wednesday.
The announcement was made by the Secretary of State for Business, Energy and Industrial Strategy, who prevented the merger under section 26 of the National Security Investment Act 2021.
According to the statement, the Secretary considered the agreement a risk to national security due to “the application of the intellectual property, knowledge, processes and techniques for the software developed and owned by the Qualifying Entity for the electronic design automation (EDA) products, to facilitate the building of cutting-edge integrated circuits that could be used in a civilian or military supply chain.”
Additionally, the UK government reported concerns that the EDA tools could potentially be used to introduce new features into the design that could be used to build defence or technological capabilities automatically and without user authorisation.
“Those risks would arise on the transfer of the Qualifying Entity and the Asset to the Acquirer,” said the Secretary.
The government said it considered the final order against the transaction “necessary and proportionate” to mitigate the national security risk.