Inseego Corp. announced on April 24 that it has still not received U.S. government approval for its $50 million sale of its Novatel Wireless business to a Hong Kong company. San Diego-based Inseego (Nasdaq: INSG) warned that it may have to pursue other options with the business.
Inseego wants to sell the business, which makes MiFi intelligent mobile internet hot spots, to concentrate on services.
For the second time, Inseego and TCL Industries Holdings (H.K.) Ltd. withdrew and refiled their joint voluntary notice to the Committee on Foreign Investment in the United States. The Defense Production Act of 1950 requires such a notice. The committee — which includes members from the departments of Defense, State, Treasury, Homeland Security, Justice, Energy and Commerce — evaluates the national security implications of business transactions. Treasury Secretary Steven Mnuchin is the committee’s chair.
Inseego said all parties and the U.S. government need more time to work out a definitive mitigated agreement that would let the committee approve the transaction.
“We remain hopeful that the sale of the MiFi business to TCL can be completed,” said Sue Swenson, Inseego’s CEO, in a prepared statement. “However, in the event that the transaction is suspended or prohibited by the U.S. government, Inseego will be compelled to pursue other strategic alternatives with respect to the MiFi business.”
In the same statement, Nicolas Zibell, CEO of TCL Communication, said his business looked forward to increasing its presence, business and employee base within the United States.
In February, Inseego said it hoped to get the required approval by the end of the first quarter.