Why LPE attacks Draghi and Giorgetti on the anti-China golden power
The government has applied golden power by stopping the sale of the company Lpe, which specializes in the production of epitaxial reactors, to a Chinese group. But the move for the Italian company, which exports 60% of its production to China, grumbles. Here because
The Draghi government did not take into account the side effects with the exercise of the golden power on the sale of the company Lpe Spa to the Chinese.
The Ministry of Economic Development, in agreement with the Ministry of Defense and that of Foreign Affairs, has proposed to use the special powers to block the acquisition, by a Chinese company, Shenzhen Investment Holdings, of 70% of capital of the Italian company, Lpe spa, active in the semiconductor sector.
During the meeting of the CDM on March 31, the executive used the first exercise of veto in the context of golden power, thus blocking the sale of LPE to the Chinese.
The Minister of Economic Development, Giancarlo Giorgetti (Lega), had announced, among other things, that the Mise is also evaluating the possibility of "extending the scope of application of the golden power" to relevant supply chains, "particularly exposed to competition Chinese".
“I agree with Giorgetti, the golden power is a government tool to avoid the sale of strategic assets to foreign powers, it must be used. The semiconductor one was a use of common sense in this situation. It is a strategic sector, there are others ”, commented Prime Minister Mario Draghi.
If the production of semiconductors, used above all in the automotive sector, in that of the defense industry but also in the electronics sector, is therefore considered an increasingly strategic sector, in the case of the Lpe company the move of the golden power of strategic seems to have had very little.
In fact, the Baranzate-based company would not exist without its Chinese market share. And the Lpe entrepreneurs turned to Mario Draghi and Giancarlo Giorgetti, as reported today by L'Economia , the insert of Corriere della Sera , in an article by Ferruccio de Bortoli. According to executives, this stop will only do a favor to those who copy patents.
All the details.
WHAT THE LPE COMPANY DOES AND THE CHINESE MARKET SHARE
Founded in 1972, Lpe SpA of Milan designs and manufactures epitaxial reactors and has 52 employees.
As already reported on Start , since 2003 the company from Baranzate has a Chinese branch, dedicated to technical and commercial assistance in China, the main market for the Lombard company.
In fact, the company's Chinese market share stands at 60%. The Italian one is worth 4%.
The same company highlighted how the dominant market for Lpe is for Asia in particular China, a country in which Lpe has been present since the 1980s.
THE MISSIVE OF LPE ENTREPRENEURS TO THE GOVERNMENT
Therefore, following the stop of the sale to the Chinese Shenzhen Investment Holdings, of 70% of the capital of the Italian company, Franco Preti and Massimo Sordi, respectively CEO and president of lpe Spa, wrote a letter to Mario Draghi and Giancarlo Giorgetti, complaining the expropriation nature of the decree on golden power, as reported by L'Economia.
“We take the liberty of bringing to your attention the feelings of profound bitterness that the measure has provoked in us in various ways. “It is recalled in the letter – writes de Bortoli – that the company produces only the epitaxial reactor, one of the many plants used in the semiconductor manufacturing cycle. Nothing strategic or related to defense ”.
CHINESE OPERATION REQUIRED
In the letter, the two entrepreneurs underlined to the attention of Draghi and Giorgetti that “in fact Lpe is a completely Chinese company, albeit located in Italy and with Italian shareholders. Without its market share in China, LPE would not have existed for years ”.
And that the operation, beyond the undeniable patrimonial advantage, was conceived "to appear Chinese in the eyes of the Chinese with the aim of being better protected in our intellectual property that is not jeopardized by those who buy it, as the concern of the provision appears to have been, but from those who steal and will continue to steal it ”.
“Operational control, research and development would remain in Italy. And so is the production. With a formal commitment to increase employment, guaranteed by the Italian shareholders who would remain in the capital with 30%.
GOLDEN POWER EXERCISE IN FAVOR OF COMPETITION
"The news of the exercise of the golden power by the Italian government – always reads the letter sent to the government – became known to our worst competitors / copiers on the same day and was celebrated with joy because it hinders the growth of an Italian manufacturer (regardless of ownership of the shares) in the local market. It will be an excellent justification for netting, indeed increasing, incentives and protections for local competitors / copiers. "
“In China copying is frequent and the defense of patents is uncertain. And this is the main problem, but not the only one ”, complain the leaders of LPE.
ENTRANCE OF CHINESE WITH MINORITY SHARE?
Perhaps letting someone linked to Beijing enter the capital of the Baranzate company, perhaps in a minority, would have helped the business more. Rather than blocking the operation with the Chinese tout court.
As De Bortoli writes, “the company risks being completely overwhelmed, without those minimum guarantees on headquarters, research and employment, which at least on paper would seem to exist in the contested agreement. There is a way out. The Chinese can become a minority. The political demonstrative effect of the golden power would remain (and was perhaps indispensable as a general warning), without giving the show of defending a company by hitting it to death. "
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/perche-lpe-attacca-draghi-e-giorgetti-sul-golden-power-anti-cina/ on Mon, 19 Apr 2021 14:18:38 +0000.