Statement by the Press Secretary

President Bush today accepted the recommendation of the Committee on Foreign Investment in the United States (the Committee) that he not take action to suspend or prohibit the proposed acquisition of Ross Catherall US Holdings Inc. (Ross Catherall) by a subsidiary of Dubai Holding LLC (Dubai Holding). The President's decision was made under section 721 of the Defense Production Act of 1950 (the Exon-Florio amendment), which authorizes the President to suspend or prohibit the acquisition of a U.S. company by a foreign company where there is credible evidence to believe that the foreign interest exercising control might take action that threatens to impair the national security. Consistent with the legislation, the President will report to the Congress on his decision.

The President's decision is based upon the results of the comprehensive proceedings on this transaction undertaken by the Committee, a 12-member interagency group chaired by the Department of the Treasury. In assessing the proposed acquisition's impact on national security, the Committee conducted both a 30-day review and a 45-day investigation. To support the work of the Committee, the intelligence community, as coordinated by the Director of National Intelligence and the National Intelligence Council, completed an assessment in conjunction with experts from Committee member agencies. That assessment examined national security issues ranging from counterterrorism to counterproliferation to counterintelligence, among others.

The Committee, with support from the intelligence community, reviewed information concerning the acquiring company, that company's ultimate owners, and potential vulnerabilities that might result in threats to national security. The Committee specifically considered the fact that a U.S. subsidiary of Ross Catherall is a single source supplier of turbine engine blades for the Department of Defense (DOD). While the Committee did not find credible evidence to suggest that either Dubai Holding or its ultimate owners might take action to threaten national security, Dubai Holding's subsidiary made contractual commitments to DOD to assure reliability of supply. Finally, the Committee took into account DOD authority under U.S. law to compel any manufacturer located within the United States to meet critical supply requirements.

In addition to the Department of the Treasury, the Committee's member agencies include: the Departments of State, Defense, Justice, Commerce, Homeland Security, and the Office of Management and Budget, the Office of the United States Trade Representative, the National Security Council, the National Economic Council, the Council of Economic Advisers, and the Office of Science and Technology Policy.