4 ms·

The US Government Blocks MoneyGram’s $1.2B Sale to Alibaba’s Ant Financial

70 points by dragon1st 9y ago

craftyguy 9y ago
Who gets blamed if MoneyGram folds as a company since this deal was blocked? It seems like another pyrrhic victory for donald and his friends.
- antishatter 9y ago
  Please, MoneyGram will fold because they are often caught assisting money launderers and fraudsters in addition to their exploitative fee structure.
  - KasianFranks 9y ago
    and crypto
  - Consultant32452 9y ago
    Conspiracy theory time: Some US TLAs use MoneyGram to launder money for off-books activities and the US gov't doesn't want all that "evidence" in the hands of the Chinese.
- kevin_thibedeau 9y ago
  If you can't be successful as a rapacious money changer then you don't deserve to be in business. The real question is why the leadership of a massively profitable business is unwilling to just do their job and run an independent company.
thisisit 9y ago
> Back in September, a private equity group was blocked from purchasing Lattice Semiconductor due to potential security risks. Prior to the Trump administration, just three deals had been blocked over the past 27 years. Does anyone know how many acquisitions (and not deals) like these happen during last 27 years? I tried searching and found this article from Obama's administration: https://qz.com/863997/chinas-decades-long-acquisition-spree-in-the-us-could-soon-come-to-an-end/ https://qz.com/863997/chinas-decades-long-acquisition-spree-... Most of it talks about acquiring stakes but not outright acquisition. But the interesting parts is here > In a document, the US Government Accountability office specifically singled out the rise of Chinese companies with state ties as worthy of more scrutiny, noting that some acquisitions might ultimately be bad for competition. > Meanwhile, in November, President Obama played a direct role in blocking China’s Fujian Grand Chip from purchasing the German semiconductor firm Aixtron.
- abiox 9y ago
  > > In a document, the US Government Accountability office specifically singled out the rise of Chinese companies with state ties as worthy of more scrutiny i suppose you could say this about almost anywhere, to varying degree, but especially in a place like china: isn't that basically every company? (re: 'state ties')
crb002 9y ago
Just buy a gross revenue share. They can't block that easily.
- r00fus 9y ago
  I googled this and can't find references? Can you explain what this means?
booleanbetrayal 9y ago
Here's a recent primer on Ant Financial's relationship with social status ranking and government relations -- https://www.wired.com/story/age-of-social-credit/ https://www.wired.com/story/age-of-social-credit/
- xster 9y ago
  It was a fun read but I feel like the article is also partly re-invoking your imagination on assumed stereotypes you already had. I'm by no means an expert but from playing around with it a bit, it seems no different from something like Klout which came and past in that it takes your scores and mostly uses it to send you lame in-house 'benefits' promos that are more like normal ads. Something like https://epic.org/algorithmic-transparency/crim-justice https://epic.org/algorithmic-transparency/crim-justice is far more impactful and interesting.
  - booleanbetrayal 9y ago
    I think the article is just illustrative of what data is sloshing about, how it's being gathered, who is taking an interest in it, and an indulgence into the possible motives fueling it all.
adventured 9y ago
It's an extremely reasonable, ideal way to deal with China's one-way economic behavior. They don't allow foreign corporations to buy up their domestic companies. They place foreign companies at an intentionally severe disadvantage. You can hardly operate in the country at all without selling a big part of your operations to a domestic entity (or otherwise being the minority partner). Every developed nation is beginning to approach China similarly on this issue. It'll keep getting worse for China on this issue until they begin dismantling their extreme protectionism.
- nipplesurvey 9y ago
  Indeed, hearing China nag US for protectionism is some serious pot calling the kettle black.
gigatexal 9y ago
How is this an issue of national security?
- lerie82 9y ago
  Something about Alibaba being tied to terrorist organizations? but I've been wrong before
  - remind_me_again 9y ago
    These days it goes like this, if they are not doing what you demand, call them names...
baybal2 9y ago
Economic war it is, plainly and simple. Just like UK was ripping of India with trade in fabrics, so does China now with the rest of the world. And so did USA with countless countries in the past, now they are just surprised how unexpectedly fast they ended up on the other end of the barrel.
- aphextron 9y ago
  >Economic war it is, plainly and simple. Sure beats the hell out of war war.
Tzedek 9y ago
I feel like I am going full dumb dumb here, but: how is this actually bad? I read: "US government prevents Chines company from owning yet another piece of our ass" excuse the french Not trying to troll, really interested in what the downsides are.
- 1_2__4 9y ago
  None. This is great news. America is not helped at all by a foreign company owning a money transfer service, although I expect to see an avalanche of market worshippers saying how this is actually bad because markets markets markets.
- kuwze 9y ago
  I'd say considering the crazy mergers we're having stateside that this is just another example of sinophobia.
- omarforgotpwd 9y ago
  China has a lot of capital and the blocking of sales for national security reasons should theoretically put downward pressure on valuations due to reduced demand for certain US assets. However blocking sales for national security reasons is nothing new, and just "the way it is" for now. Would be great if our relationship with China was as strong as our relationship has traditionally been with countries like the UK and France.
  - toomuchtodo 9y ago
    China’s ambitions prohibit the US and China from being partners (such that the US is with the UK and France). As a US citizen, I’d prefer we not sell off all of our assets for short term gain, only to be sharecroppers to China in the long term. Warren Buffet warned us about this years ago: https://youtu.be/vx5XPvQO4pI https://youtu.be/vx5XPvQO4pI
    - omarforgotpwd 9y ago
      I think this economic us vs them mentality is backwards. I'm a US citizen, but both China and the US are populated by humans. In a fair world, Americans should be able to make money in China while Chinese make money in America. If I sell AMC theaters to a Chinese citizen, and use that money to start a self driving car company, is that sharecropping or is it just a deal that both parties found personally advantageous? Does it make any difference to AMCs investment and hiring in the US? Is that Chinese citizen even that much less likely to spend the profits from AMC on US goods and services than an American citizen? Human innovation is not a zero-sum game and separating the world into competing nation-teams actually just holds both parties back, in my opinion.
wmf 9y ago
Clearly they should have done the acquisition on the blockchain instead.

70 points by dragon1st 9y ago

Who gets blamed if MoneyGram folds as a company since this deal was blocked? It seems like another pyrrhic victory for donald and his friends.

antishatter 9y ago
Please, MoneyGram will fold because they are often caught assisting money launderers and fraudsters in addition to their exploitative fee structure.
- KasianFranks 9y ago
  and crypto
- Consultant32452 9y ago
  Conspiracy theory time: Some US TLAs use MoneyGram to launder money for off-books activities and the US gov't doesn't want all that "evidence" in the hands of the Chinese.
kevin_thibedeau 9y ago
If you can't be successful as a rapacious money changer then you don't deserve to be in business. The real question is why the leadership of a massively profitable business is unwilling to just do their job and run an independent company.

thisisit 9y ago

> Back in September, a private equity group was blocked from purchasing Lattice Semiconductor due to potential security risks. Prior to the Trump administration, just three deals had been blocked over the past 27 years. Does anyone know how many acquisitions (and not deals) like these happen during last 27 years? I tried searching and found this article from Obama's administration: https://qz.com/863997/chinas-decades-long-acquisition-spree-in-the-us-could-soon-come-to-an-end/ https://qz.com/863997/chinas-decades-long-acquisition-spree-... Most of it talks about acquiring stakes but not outright acquisition. But the interesting parts is here > In a document, the US Government Accountability office specifically singled out the rise of Chinese companies with state ties as worthy of more scrutiny, noting that some acquisitions might ultimately be bad for competition. > Meanwhile, in November, President Obama played a direct role in blocking China’s Fujian Grand Chip from purchasing the German semiconductor firm Aixtron.

abiox 9y ago
> > In a document, the US Government Accountability office specifically singled out the rise of Chinese companies with state ties as worthy of more scrutiny i suppose you could say this about almost anywhere, to varying degree, but especially in a place like china: isn't that basically every company? (re: 'state ties')

crb002 9y ago

Just buy a gross revenue share. They can't block that easily.

r00fus 9y ago
I googled this and can't find references? Can you explain what this means?

booleanbetrayal 9y ago

Here's a recent primer on Ant Financial's relationship with social status ranking and government relations -- https://www.wired.com/story/age-of-social-credit/ https://www.wired.com/story/age-of-social-credit/

xster 9y ago
It was a fun read but I feel like the article is also partly re-invoking your imagination on assumed stereotypes you already had. I'm by no means an expert but from playing around with it a bit, it seems no different from something like Klout which came and past in that it takes your scores and mostly uses it to send you lame in-house 'benefits' promos that are more like normal ads. Something like https://epic.org/algorithmic-transparency/crim-justice https://epic.org/algorithmic-transparency/crim-justice is far more impactful and interesting.
- booleanbetrayal 9y ago
  I think the article is just illustrative of what data is sloshing about, how it's being gathered, who is taking an interest in it, and an indulgence into the possible motives fueling it all.

adventured 9y ago

It's an extremely reasonable, ideal way to deal with China's one-way economic behavior. They don't allow foreign corporations to buy up their domestic companies. They place foreign companies at an intentionally severe disadvantage. You can hardly operate in the country at all without selling a big part of your operations to a domestic entity (or otherwise being the minority partner). Every developed nation is beginning to approach China similarly on this issue. It'll keep getting worse for China on this issue until they begin dismantling their extreme protectionism.

nipplesurvey 9y ago
Indeed, hearing China nag US for protectionism is some serious pot calling the kettle black.

gigatexal 9y ago

How is this an issue of national security?

lerie82 9y ago
Something about Alibaba being tied to terrorist organizations? but I've been wrong before
- remind_me_again 9y ago
  These days it goes like this, if they are not doing what you demand, call them names...

baybal2 9y ago

Economic war it is, plainly and simple. Just like UK was ripping of India with trade in fabrics, so does China now with the rest of the world. And so did USA with countless countries in the past, now they are just surprised how unexpectedly fast they ended up on the other end of the barrel.

aphextron 9y ago
>Economic war it is, plainly and simple. Sure beats the hell out of war war.

Tzedek 9y ago

I feel like I am going full dumb dumb here, but: how is this actually bad? I read: "US government prevents Chines company from owning yet another piece of our ass" excuse the french Not trying to troll, really interested in what the downsides are.

1_2__4 9y ago
None. This is great news. America is not helped at all by a foreign company owning a money transfer service, although I expect to see an avalanche of market worshippers saying how this is actually bad because markets markets markets.
kuwze 9y ago
I'd say considering the crazy mergers we're having stateside that this is just another example of sinophobia.
omarforgotpwd 9y ago
China has a lot of capital and the blocking of sales for national security reasons should theoretically put downward pressure on valuations due to reduced demand for certain US assets. However blocking sales for national security reasons is nothing new, and just "the way it is" for now. Would be great if our relationship with China was as strong as our relationship has traditionally been with countries like the UK and France.
- toomuchtodo 9y ago
  China’s ambitions prohibit the US and China from being partners (such that the US is with the UK and France). As a US citizen, I’d prefer we not sell off all of our assets for short term gain, only to be sharecroppers to China in the long term. Warren Buffet warned us about this years ago: https://youtu.be/vx5XPvQO4pI https://youtu.be/vx5XPvQO4pI
  - omarforgotpwd 9y ago
    I think this economic us vs them mentality is backwards. I'm a US citizen, but both China and the US are populated by humans. In a fair world, Americans should be able to make money in China while Chinese make money in America. If I sell AMC theaters to a Chinese citizen, and use that money to start a self driving car company, is that sharecropping or is it just a deal that both parties found personally advantageous? Does it make any difference to AMCs investment and hiring in the US? Is that Chinese citizen even that much less likely to spend the profits from AMC on US goods and services than an American citizen? Human innovation is not a zero-sum game and separating the world into competing nation-teams actually just holds both parties back, in my opinion.

wmf 9y ago

Clearly they should have done the acquisition on the blockchain instead.