US investigating 2nd Dubai-owned company - WPost

WASHINGTON, March 1 (Reuters) The Bush administration has opened a national security probe of a second Dubai-owned company amid a political storm over a deal with state-owned Dubai Ports World, The Washington Post reported today.

The secretive Committee on Foreign Investment in the United States (CFIUS) is reviewing Dubai International Capital's acquisition of London-based Doncasters Group Ltd, which operates in nine US locations and makes precision parts for US defence contractors, the newspaper reported.

The administration notified Congress this week that it was investigating a proposed deal by Dubai International as well as another by an Israeli firm and has been privately briefing some House and Senate committee leaders on both transactions, the newspaper said.

A spokesman for the US Treasury Department, which oversees CFIUS, said he could not comment on the company.

The Israeli Internet security company Check Point Technologies Ltd said earlier this month its pending acquisition of Maryland-based Sourcefire Inc. had moved into the investigative stage at CFIUS.

The White House is facing a bipartisan uproar over a deal to let state-owned Dubai Ports World run terminals at major US ports such as New York and New Jersey in its takeover of assets of Britain's P&O.

Administration officials decided to inform lawmakers of the two other pending transactions with national security implications to head off further controversy, the Washington Post said.

Some US lawmakers complained that the deal with Dubai Ports World would undermine security in the vulnerable shipping sector and could make it easier for militants to attack the United States.

The White House agreed on Sunday to a new 45-day security review of DP World. An initial government probe had approved the deal last month.

Deputy Treasury Secretary Robert Kimmitt yesterday told a House of Representatives panel on Wednesday that since CFIUS was established in 1988, it has reviewed 1,604 transactions for potential national security concerns but only 25 cases have gone through investigation.

REUTERS KD SP1157