Jin Jiang International/Radisson Hotels Divestiture/Committee on Foreign Investments in the United States (CFIUS) - June 2022

Situation: When Jing Jiang International purchased the Radisson Hotel Group in November 2018, the transaction prompted a review from the U.S. Treasury’s Committee on Foreign Investments in the United States (CFIUS). The review concluded that Jin Jiang operations in the U.S. would remain under CFIUS review in order to protect American citizens' consumer data from potential improper use by the China-based company. After nearly four years of owning the U.S.-based Radisson chain, Jin Jiang opted to divest from it because of the risks and costs associated with CFIUS compliance, but it would retain its ownership stake in Radisson Hotels in Europe and Southeast Asia.

Challenge: The parties sought to complete the transaction and avoid being drawn into the conversation about U.S.-China tensions, while also protecting the integrity of Radisson’s global brand. This was particularly important since Jin Jiang would continue to own a stake of the properties outside the U.S. The deal would take place amid rising U.S.-China tensions, and the potential for costly agency scrutiny and extended CFIUS reviews were on the table.

Advice: Keep communications to a minimum to avoid stoking anti-China sentiments and attract unwanted regulatory reviews from both the U.S. and China. Both parties involved were advised to run a low-profile campaign in order to meet the minimum requirements for SEC disclosures and minimize anti-China-related coverage. This included no press releases and only responding to media reactively to clarify data points. External communications were limited to regulatory filings as mandated by securities law, and executives participated in no interviews about the transaction, save for SEC-required forums such as earnings calls and investor presentations. 

Result: Despite involving a globally recognized brand, the transaction took place as designed– quietly with minimum media coverage. Tier-one media referenced the deal and the hotel travel and leisure trades covered it extensively, but the media cycle was short. The deal closed on time and without any U.S.-China regulatory intervention beyond the normal reviews.

(Note: Advice was provided by Bob Christie at a previous employer)