FOCI

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Volume VIII – Foreign Buyers Do Make a Difference

Not every potential buyer is a U.S. corporation controlled by U.S. interests.  It is important, both for the buyer and the seller, to understand the implications of foreign ownership, control, or influence (“FOCI”) on the feasibility of a sale to foreign interests and the processes that apply to such sales.  As the title of this posting makes clear, foreign buyers do, in fact, make a difference.Continue Reading What You Need to Know About Mergers and Acquisitions Involving Government Contractors and Their Suppliers

By Marko W. Kipa

We all now realize that, contrary to the pronouncements of certain pundits, the world is not economically flat.  But it is undeniable that its citizens and businesses are more economically connected than ever before. One manifestation of this interconnectedness is the increasing number of cross-border acquisitions of business enterprises. In most cases these transactions do not become the subject of public discussion or detailed government scrutiny.  But when foreign entities seek to purchase U.S. government contractors who perform classified national security work and therefore hold facility security clearances (“FCLs”), the U.S. Government is anxious to know, among other things, the extent to which the company is the subject of foreign ownership, control or influence (“FOCI”).  Being under FOCI can sound the death knell for a company’s ability to perform classified work, with consequent loss of business that may be critical to the company’s continued status as a going concern. But that outcome can often be avoided by development and submission of a FOCI mitigation plan which, if accepted either as submitted or modified, can enable the company to continue performance of national security work.
 Continue Reading Evaluating FOCI In The Context Of An M&A Transaction