Statement by Press Secretary Fitzwater on the Acquisition of Norton Company by BTR of the United Kingdom

The President has decided against intervening in the possible acquisition of Norton Co. by BTR plc of the United Kingdom. Norton Co. manufactures abrasive products and engineering materials, including advanced ceramics. In addition, Norton has engaged in extensive research and development of advanced ceramics and diamond films.

The President based his decision on the results of the investigation by the Committee on Foreign Investment in the United States (CFIUS), chaired by Treasury Secretary Nicholas F. Brady. CFIUS conducted a thorough investigation of various national security issues relating to this possible acquisition.

The BTR-Norton investigation was conducted pursuant to section 5021 of the Omnibus Trade and Competitiveness Act of 1988. That provision, known as the Exon-Florio provision, authorizes the President to investigate and, if necessary, to suspend or prohibit a proposed foreign acquisition of a U.S. business engaged in interstate commerce. The criteria to suspend or prohibit a transaction are that the President must find: credible evidence that leads him to believe that the foreign investor might take action that threatens to impair the national security; that existing laws, other than the International Emergency Economic Powers Act and the Exon-Florio provision itself, do not provide adequate and appropriate authority to protect the national security.