Acquisition of GNC by Chinese company should undergo CIFUS review: Senator, Marco Rubio

In a significant development, U.S. Senator Marco Rubio has asked for a national security review of General Nutrition Centers plans to sell itself to Harbin Pharmaceutical Group Co Ltd.

Rubio made the request in a letter to Treasury Secretary Steven Mnuchin. The Treasury Department leads the inter-agency Committee on Foreign Investment in the U.S.

In a statement, health and nutrition products retailer GNC said, in principle, it has agreed, with lenders, to sell itself to Harbin Pharmaceutical for $760 million in a court supervised auction. Harbin is incidentally its largest shareholder. It went on to add, Harbin’s controlling stake was reviewed by CFIUS and approved in 2018. It also highlighted that no consumer data was available to any foreign national.

“That (2018) transaction was approved, and no facts or circumstances have changed to call the committee’s support into question. We will continue to work with all relevant agencies throughout the restructuring process and maintain our rigorous standards for data privacy,” said GNC’s spokesperson.

In his letter to the Treasury Secretary Rubio said, the Chinese government is likely to get access to sensitive data on Americans through a variety of means, including GNC data.

“Efforts to obtain personal and sensitive data related to health information and financial transactions of U.S. persons must be reviewed with an understanding of the malign foreign policy and intelligence aims of the Chinese government and Communist Party,” wrote Rubio.

He also noted in the letter that GNC has many shops near U.S. military facilities.

“In the event of a GNC acquisition by HPGC, Chinese authorities and intelligence officials could leverage GNC military sites to gain access to those restricted locations” wrote Rubio.

Categories: Creativity, Entrepreneurship, HR & Organization, Regulations & Legal, Strategy

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