Status: Withdrawn/Abandoned

 

Acquirer:  T.C.L. Industries Holdings (H.K.) Limited (Hong Kong SAR, China); TCL Corporation (China)

Acquired:  Inseego Corp. (U.S.); Novatel Wireless, Inc. (U.S.)

Value:  US$50 million

Industry:  Telecommunications

 

iStock_000038124684_LargeUPDATE:  On June 7, 2017, Novatel announced that it “decided to terminate the purchase and sale agreement it entered into with TCL in September 2016 with respect to the sale of its MiFi business.”  (Press Release, Inseego Announces Termination of Transaction with TCL, Leadership Changes, and Company-Wide Restructuring, June 7, 2017.)  The parties had previously pulled and refiled their CFIUS notice on two prior occasions.  (See previous blog posts on this page.)


Posted on May 16, 2017

Status: Withdraw and Refile (again)

As noted in an earlier update, On February 3, 2017, in connection with Inseego Corp.’s proposed sale of Novatel Wireless, Inc. (in particular, the “MiFi Business”) to T.C.L. Industries Holdings (H.K.) Limited and Jade Ocean Global Limited, the Parties voluntarily withdrew and re-filed their Joint Voluntary Notice to CFIUS.  (See Inseego, Form 8-K, Feb. 3, 2017, SEC Filing; Inseego Press Release, Ex-99.1, Form 8-K, Feb. 3, 2017, SEC Filing.)   According to Inseego Corp., the parties have repeated this process: “[i]n April 2017 . . . the [parties] once again voluntarily withdrew and re-filed their notice to CFIUS in order to obtain additional time to continue negotiations between CFIUS and the Purchasers regarding the final terms of a mitigation agreement, which negotiations remain ongoing.”   (Inseego, Form 10-Q, May 15, 2017, SEC Filing.)  The filing goes on to note that “[t]he completion of the sale of the MiFi Business to the Purchasers is subject to the satisfaction or waiver of various conditions, including the approval of the transaction by CFIUS, which may not be satisfied in a timely manner or at all.” (Id.)


Posted on April 4, 2017

Status: Investigation/Mitigation

Inseego Corp., announced on March 31, 2017, that in relation to the proposed acquisition of Novatel Wireless, including the Inseego’s MiFi branded hotspots and USB modem product lines (the “MiFi Business”),  by T.C.L. Industries Holdings (H.K.) Limited and Jade Ocean Global Limited (the “Purchasers”), that “CFIUS has identified national security concerns relating to the [Inseego’s] sale of the MiFi Business.”  (Inseego Form 10-K, Mar. 31, 2017, SEC Filing.)  Inseego stated in its regulatory filing that the parties voluntarily withdrew and refiled their notice to CFIUS in February, in part to “explore potential mitigation measures that may allow the transaction to proceed.”  (Id.)  “In early March 2017, CFIUS provided a draft mitigation agreement which, if finalized, would allow CFIUS approval to be granted;” however, “[n]egotiations between CFIUS and the Purchasers regarding the final terms of such mitigation agreement remain ongoing.”  (Id.)


Posted on March 10, 2017

Status: Investigation

Inseego Corp., a provider of solutions for the Internet of Things (“IoT”), announced that in connection with the proposed sale of its MiFi mobile broadband business, with its subsidiary, Novatel Wireless, Inc., to T.C.L. Industries Holdings (H.K.) Limited, and Jade Ocean Global Limited, the Parties voluntarily withdrew and re-filed the Joint Voluntary Notice to the Committee on Foreign Investment in the United States (“CFIUS”) on February 3, 2017.  (See Inseego Press Release, Inseego Awaits Regulatory Approval from CFIUS to Close Pending Sale of MiFi® Mobile Broadband Business, Mar. 9, 2017, attached as Ex-99.1 to Inseego Form 8-K, Mar. 9, 2017, SEC Filing.) “On March 8, 2017, CFIUS informed the Parties that, with the conclusion of the 30-day period for reviewing the re-filed JVN, CFIUS is undertaking an investigation of the proposed transaction, to be completed no later than April 24, 2017.” (Id.)


Posted on February 14, 2017

Status: Withdraw and Refile

On February 3, Inseego Corp. issued a press release and made a security filing stating that, in connection with its proposed sale of Novatel Wireless, Inc. to T.C.L. Industries Holdings (H.K.) Limited and Jade Ocean Global Limited, “the Parties have voluntarily withdrawn and re-filed their Joint Voluntary Notice to the Committee on Foreign Investment in the United States (“CFIUS”) under the Defense Production Act of 1950 in order to provide sufficient time for the Parties and CFIUS to finalize the terms of a definitive mitigation agreement with respect to the proposed Sale.”  (Inseego, Form 8-K, Feb. 3, 2017, SEC Filing; Inseego Press Release, Ex-99.1, Form 8-K, Feb. 3, 2017, SEC Filing.)  The Parties previously announced in December 2016 that CFIUS was undertaking a 45-day investigation of the sale that was to be completed no later than February 6, 2017.


Posted on January 5, 2017

Status: Pending Investigation

On December 21, 2016, the Committee on Foreign Investment in the United States (CFIUS) informed the parties that it will conduct a 45-day review of the Sale that is to be completed no later than February 6, 2017. (Inseego Corp., Schedule 14A Information, Dec. 23, 2016, SEC Filing.)


Posted on December 13, 2016

Status: Upcoming/New Filing

Novatel Wireless, Inc., a Delaware corporation (“Novatel Wireless”), entered into a Stock Purchase Agreement on September 21, 2016, with T.C.L. Industries Holdings (H.K.) Limited, a Hong Kong limited liability company and wholly owned subsidiary of TCL Corp., a Chinese limited liability company listed on the Shenzhen Stock Exchange (stock code: 100).  (See Novatel Wireless Form 8-K, Sept. 22, 2016, SEC filing; see also T.C.L. Communication Technology Holdings Limited Press Release, June 13, 2016 (explaining TCL Corp. ownership.)    Novatel is “a leading global provider of software-as-a-service (SaaS) and solutions for the Internet of Things (IoT).” (Novatel Press Release, Form 8-K, Ex-99.1, Sept. 22, 2016, SEC Filing.)  TCL Communication Technology Holdings Limited is the group within TCL Corp. that “is principally engaged in the design, development, manufacturing and sale of electrical appliances and electric products and provision of internet services.”  (T.C.L. Communication Technology Holdings Limited Press Release, June 13, 2016.)  Under the agreement, Novatel will sell its “mobile broadband business, which includes its MiFi branded hotspots and USB modem product lines.”   (Novatel Wireless Form 8-K, Sept. 22, 2016, SEC filing.)  The deal is contingent on obtaining clearance from the Committee on Foreign Investment in the United States (CFIUS) .  (Id.)  A joint voluntary notice was accepted for review by CFIUS on November 22, 2016.  (See Inseego Schedule 14A, Nov. 23, 2016, SEC Filing.)

“In conjunction with the sale of the mobile broadband business, Novatel Wireless created a new public holding company on November 9, 2016, Inseego Corp., that holds Novatel Wireless and the non-acquired businesses of Novatel, including “Ctrack’s fleet management and telematics solutions business and FW’s Connectivity Solutions business.” (See transcript in Novatel Wireless  Schedule 14A, Sept. 23, 2016, SEC Filing; Novatel Wireless Form 8-K, Nov. 3, 2016, SEC Filing; Novatel Wireless Form 8-K, Nov. 9, 2016, SEC Filing.)