Flush with cash and a strong desire to expand their global reach, Chinese companies have stepped up their shopping spree to acquire U.S.S. assets, highlighted...

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Flush with cash and a strong desire to expand their global reach, Chinese companies have stepped up their shopping spree to acquire U.S. assets, highlighted yesterday by an aggressive bid for Unocal and a day earlier by an offer to buy Maytag.

“I’d expect at least a half a dozen similar deals by the end of the year,” said Jack J.T. Huang, chairman of international law firm Jones Day’s Greater China practice.

Mainland Chinese investments in the United States so far have been relatively small, attracting little attention. But analysts predict China’s growing visibility could spark a backlash reminiscent of anti-Japan sentiments that arose two decades ago, given concerns on Capitol Hill that China represents a serious economic threat and future military challenger.

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Chinese acquisitions of strategic assets such as oil reserves will require vetting by the U.S. government and could aggravate tensions in Congress over the bulging trade deficit with China and China’s reluctance to revalue its currency, analysts say. U.S. companies complain that the Chinese yuan is undervalued by as much as 40 percent, giving China an unfair trade advantage by making its exports cheaper.

“There’s going to be a fuss about this in Washington for sure, and I don’t think it is a foregone conclusion that Washington would say yes to (a Unocal deal),” said Donald Straszheim, chairman of Straszheim Global Advisors, a China consulting firm. “But I see no reason why it’s not reasonable to have Chinese companies investing in American companies, just like we’re happy to have Russian companies investing here or British companies investing here.”

Congressional interference with the bid by CNOOC, China’s third-largest oil producer, would be a “big mistake” and could come back to haunt U.S. companies looking to do business in China, Exxon CEO Lee Raymond told the Reuters Energy Summit on Tuesday.

Although China has long welcomed foreign money, the Beijing regime is opening the nation’s doors wider to U.S. investment in previously closed sectors such as financial services and transportation.

Last week, Bank of America announced it was investing $3 billion for a 9 percent stake in China Construction Bank, one of China’s largest banks.

The Unocal and Maytag bids, along with last December’s $1.25 billion purchase by China’s Lenovo Group of IBM’s personal-computer division, are part of a new wave of overseas investment involving powerful but little-known Chinese companies.

They are seeking to acquire sorely needed natural resources or move beyond their low-cost manufacturing base, explained Donald Tang, chairman of Bear Stearns Asia. The path is a well-trodden one, used by companies from Japan, Korea and Taiwan to get U.S. toeholds.

By purchasing global management expertise, technology, brand-name visibility and marketing networks, Chinese companies can leapfrog competitors, boost profit margins and bolster their attractiveness to consumers and investors. Beyond natural resources, the most likely acquisition targets are U.S. companies involved in consumer electronics, appliances or high technology, where China has already mastered manufacturing skills, analysts say.

Lenovo’s purchase of IBM’s personal-computer division and the bid for Maytag by the Haier Group, China’s largest refrigerator maker, are examples of this trend. On Tuesday, Haier and two U.S. buyout firms offered $1.28 billion for Maytag, topping an earlier bid by Ripplewood Holdings.

Haier opened a refrigerator factory in Camden, S.C., in 2000 but has been struggling to expand sales in the U.S. market.

“Once you have the technology, the manufacturing know-how and the brand name, the competitive landscape will be changed,” said Tang, who heads up the Asia Society’s Southern California branch.

China’s growing need for strategic resources such as oil or iron ore is driving its investment push. China is already the world’s second-largest oil consumer, after the United States, and a leading buyer of coal, steel and other commodities needed to fuel its export-oriented factories and domestic building boom.

The CNOOC bid, if successful, would be the first mainland Chinese foray into the politically sensitive U.S. oil sector. But China’s leading state-owned companies have been investing heavily in oil, natural gas and mineral projects around the world, including recent deals in the Canadian oil sands, reportedly the largest oil reserve after Saudi Arabia.

Critics of China have vowed to increase pressure on the Bush administration to look more critically at China’s investments in the United States.

U.S. Reps. Richard Pombo and Duncan Hunter, both California Republicans, sent a letter Friday to President Bush urging him to initiate a review of China’s expansion in the energy arena, including any bid by CNOOC for Unocal. Under U.S. law, the Committee on Foreign Investment in the United States, an interagency panel, is responsible for vetting any foreign purchases that could threaten U.S. security.

C. Richard D’Amato, chairman of the U.S.-China Economic and Security Review Commission, a congressional committee that has been sharply critical of U.S. policy toward China, said the implications of expanded Chinese investment were troubling because of the potential for future conflicts.

In addition to security issues, he said, the U.S. government should consider the long-term threat to U.S. competitiveness.

“One danger, to put it bluntly, is that they can loot these companies and move that technology and know-how to China over time,” he said.

Los Angeles Times staff writer Elizabeth Douglass contributed to this story. Jack J.T. Huang’s comment reported by The Associated Press. Exxon CEO Lee Raymond’s comment reported by Reuters