(Bloomberg) — Democratic Senator Chris Murphy said Saudi Arabia’s support for Elon Musk’s purchase of Twitter Inc should be scrutinized by a government panel reviewing national security threats from foreign investment in the US.
“We should be concerned that the Saudis are now the second largest owner of a major social media platform with a clear interest in suppressing political speech and influencing US politics,” Murphy said in a tweet on the social media platform on Monday. “A clear national security issue is at stake and should be reviewed by Cfius.”
Among the investors backing Musk’s takeover is Saudi Prince Alwaleed bin Talal, through Kingdom Holding Co. and his private office, who agreed to roll over about 35 million Twitter shares worth about $1.9 billion at $54.20 per share.
Murphy, of Connecticut, is the senior member of the Senate Foreign Relations Committee. Members of Congress can ask the Committee on Foreign Investment in the United States to look into the transaction, but that does not trigger a review, according to Shannon Reeves, a partner at Strock and Strock & Lavan LLP who works on related issues. Committee
“This is not the first time a member of Congress has pushed for a Cfius review of a transaction,” Reaves said in an interview. “Cfius needs to assess whether it has jurisdiction. Cfius will also have to take a preliminary look at this transaction to understand whether it has the potential to pose a threat to national security.”
Still, the request is another political pressure point on the deal, which has drawn cautious reactions from Democrats and cheers from many Republicans.
Senator Mark Warner, chairman of the Senate Intelligence Committee, also expressed concern in a recent interview about the possibility of pressure on Musk from China, where his electric car maker Tesla Inc. has a large factory, to moderate the content. don’t like
Murphy’s request to Treasury Secretary Janet Yellen for a review comes as the Biden administration considers whether the US is subject to scrutiny on national security grounds, including Musk’s purchase of Twitter and Space Exploration Technology Corp.’s contract for the Starlink satellite network. . Last week, many experts on CFIUS and its operations expressed some doubts about whether the committee has a strong enough argument to review Musk’s recent business deals.
Cfius has broad authority to review transactions. The 2018 law gave the ability to scrutinize investors with minority stakes of any size in a company that would give them access to non-public information in three categories: sensitive data, critical infrastructure and critical technology.
The panel, chaired by the Treasury Secretary and comprising representatives from other Cabinet departments and agencies, operates behind closed doors and rarely confirms when it undertakes reviews.
The panel has the power to review deals that are still in progress and that have already been completed. For example, in 2012, a Chinese-owned company bought an Oregon wind farm company, Ralls Corp. Prohibited the purchase and ordered the cancellation of the contract.
The Treasury Department declined to comment.
When a Twitter poster said the Saudis had invested in Twitter before they bought it, he responded to the poster, and Murphy took aim Monday night with two emojis, one “rolling on the floor laughing,” the other with an arrow. Bullseye
— Saleha Mohsin, Subrata Patnaik and Steven T. With the help of Dennis.
(Updates with Musk tweets in last paragraph.)
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