On February 28, 2022, the Committee on Foreign Investment in the United States (CFIUS) cleared an investment by Shanghai Pudong Science & Technology Investment Co., Ltd. (PDSTI) in ICON Aircraft, Inc. (ICON). CFIUS has jurisdiction to review the national security implications of certain mergers, acquisitions, and takeovers that could result in foreign control of any person engaged in interstate commerce in the United States. Sidley advised ICON throughout the CFIUS process, which began in August 2021.
ICON designs and manufactures a sport plane called the A5. PDSTI invested in ICON in 2015 and again in 2017, at a time when ICON was in a difficult financial situation and in need of capital. In May 2021, a group of minority investors in ICON initiated litigation against PDSTI and ICON in connection with certain allegations regarding the operation of the company. Subsequently, they asked CFIUS to review PDSTI’s investment in ICON.
CFIUS conducted a comprehensive review and investigation of PDSTI’s investment in ICON and informed the parties that it was clearing the investment without the need for mitigation.
The Sidley team advising ICON on the CFIUS process included James Mendenhall (Washington, D.C.), Grigore Alexandru (Washington, D.C.), and Nick Wiggins (Washington, D.C.). The Sidley transaction and litigation teams included Yabo Lin (Palo Alto), Wendy Lazerson (Palo Alto), Sam Newman (Los Angeles), Vijay Sekhon (San Francisco), Carol Lynn Thompson (San Francisco), Cecilia Chan (Palo Alto), Jake Funk (Palo Alto), and BinQuan Zhuang (Palo Alto).
James Mendenhall was interviewed by Foreign Investment Watch to discuss Sidley’s involvement in the case:
