The deal many people thought would not get done ended up not getting done. That deal was Canyon Bridge's proposed acquisition of Lattice Semiconductor (LSCC 5.77, +0.05, +0.9%) for $8.30 per share, which was announced last November and officially scrapped last night by President Trump.
Based on how shares of LSCC have traded since early August, it became pretty clear that investors knew where things were headed. To wit, shares of LSCC declined 21% between August 1 and September 12 to $5.55.
In fact, the stock price never exceeded the offer price since the deal was announced. LSCC topped out at $7.99 on November 8 and trended steadily lower until their final collapse mentioned above.
That downward path coincided with a lot of tough talk by the president toward China and the need to protect U.S. economic interests. It occurred, too, as Lattice Semiconductor and Canyon Bridge, which was working with a limited partner whose parent company, China Venture Capital Fund Corp., is a Chinese company, tried to make their case for the deal before the Committee on Foreign Investment in the United States (CFIUS).
The CFIUS was unable to come to an agreement with the parties on mitigation measures, so it referred the transaction to the president.
President Trump issued an executive order blocking the transaction on the recommendation of CFIUS, saying among other things that it posed a national security risk due to the potential transfer of intellectual property to a foreign acquirer, the Chinese government's role in supporting the transaction, the importance of the supply chain integrity to the U.S. government, and the use of Lattice products by the U.S. government.
Shares of LSCC are trading 0.9% higher in pre-market trading, lifted somewhat by a lifting of the uncertainty surrounding the transaction and garnering some added support from a belief the stock is oversold on a short-term basis.