Buh-Bye to Dubai?

Senator John Warner, chairman of the Armed Services Committee, has announced on the floor of the Senate floor that the United Arab Emirates firm seeking to take over operations at six American ports will transfer U.S. operations to a U.S. company.

From the Associated Press:

A Dubai-owned company said Thursday it is giving up its management stake in some U.S. ports, a move made as congressional leaders warned President Bush that both the House and Senate appeared ready to block the takeover.

Lawmakers who have been trying to block the deal involving DP World said they were studying the company's announcement to see if it adequately addressed their concerns about an Arab government taking over major operations at six U.S. ports.

. . . .

"Because of the strong relationship between the United Arab Emirates and the United States and to preserve that relationship, DP World has decided to transfer fully the U.S. operation of P&O Operations North America to a United States entity," DP World's chief operating officer, Edward H. Bilkey, said in the statement that Warner relayed to other senators. The announcement did not specify which American company would be involved.

Will this provide adequate protection for U.S. national security interests, or is this just a tactical retreat?  From the little we know so far, it could be viewed both ways.  Depending on how the deal is structured, DP World could still control the entire operation, with ownership continuing for all practical purposes through a wholly-owned U.S. subsidiary of DP World.

It will be interesting to see how this plays out.

Update 3/9/06:  The Washington Post reports that the Dubai firm will "divest itself of all U.S. interests."  If that is true, and assuming that DP World or another UAE entity does not retain or acquire ownership of the U.S. companies to whom the port operations are transferred, then this change will be more than just window dressing.  We still need more details to be sure.

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Updated 3/9/06:  For more thoughts on today's announcement, check out Right Wing News, Michelle Malkin and Wizbang

Comments

[John Lee]

Not so fast guys...just because an Arab government makes an announcement, it ain't necessarily so:

Dubai Port Capitulation Likely Fraudulent

(Via Little Green Footballs)