Kenneth Rapoza, Senior Contributor
Health food and body building chain GNC is bankrupt. Harbin Pharmaceuticals, the second largest pharma co in China, and a minority shareholder of GNC with five members on the board, wants to buy it. Florida Senator and China hawk Marco Rubio just threw a bucket of cold water on them.
Rubio sent a letter to U.S. Treasury Secretary Steven Mnuchin today to request a full review by the Committee on Foreign Investment in the United States (CFIUS) of the potential acquisition of GNC Holdings Inc. by Harbin, scheduled for final bidding in bankruptcy court proceedings tomorrow.
CFIUS decides if foreign ownership of an American based company is a security risk.
“The Chinese government engages in persistent efforts to obtain a broad range of sensitive American personal data through illicit means such as state-sponsored theft from government agencies and private companies,” he said in a statement Thursday afternoon. The acquisition of a major health and nutrition chain with over 5,200 retail stores in the United States and an expansive customer base presents the opportunity for state-directed actors to purchase this information legally. Efforts to obtain personal and sensitive data related to health information and financial transactions of U.S. persons must be reviewed with an understanding of the malign foreign policy and intelligence aims of the Chinese government and Communist Party.”
One issue surrounding GNC that may convince CFIUS that Harbin isn’t the right suitor is the fact that its stores are near or on dozens of military bases, including Andrews Air Force Base, Quantico, and 29 Palms. Harbin would then have access to their information, which is bankable if not subject to cybersecurity issues like data breaches and identity theft, something China has been accused of for years.
On September 3, 14 year old DC advocacy group and think tank, the Coalition for a Prosperous America, sent a letter to Treasury Secretary Steven Mnuchin asking for a CFIUS review of the GNC bankruptcy sale potentially going to Harbin, The Washington Examinerreported last week.
“This is exactly the type of acquisition that CFIUS was designed to review and to ensure that national security implications of foreign investments are not problematic,” the group’s CEO Michael Stumo and its chairman Dan DiMicco wrote in the letter.
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