After the expiration of a 45-day investigation, President Bush on Monday was expected to make a decision to approve (or disapprove) the sale of SVG to ASML. But the decision has been delayed at least for 15 more days, reportedly after the Bush administration could not form a consensus over the long-awaited--and emotional--merger between the two lithography companies.

According to a statement from ASML, the Committee on Foreign Investment in the United States (CFIUS)--which conducted the 45-day review--has sent its recommendation with respect to the ASML-SVG merger to President Bush.

The Exon-Florio process now mandates a presidential decision within 15 days--a series of events that represents another delay in the merger.

ASML and SVG expressed their disappointment about the decision to delay the merger. But they also believe that the deal will be approved after the 15-day review.

"We are obviously disappointed by this brief delay but pledge to work closely and cooperatively with the U.S. government in its review," said Doug Dunn, chief executive of ASML. "We are optimistic that upon completion of this review, we will be in a position to close this merger promptly."

As reported by SBN yesterday, there were signs that the deal would be delayed again (see April 23 story ). By midnight yesterday (Monday), President Bush was expected to render a final decision concerning the proposed ASML-SVG merger.

While no decision had been announced by the companies as of early Monday evening, some sources believe that the Bush administration is still split over the proposed ASML-SVG merger.As of late last week, the Bush administration was struggling to take an official position on the proposed ASML-SVG merger (see April 20 story ).

And judging by the activity in the stock market--especially with the falling share prices of both ASML and SVG--it was unclear if the Bush administration would make the final decision by the deadline.

The market reacted as though the ASML-SVG deal hit a snag in Washington. On Monday, ASML's shares fell $1.27 per share to $26.29, while SVG dropped $3.44 to $29.56.

Fearing that the Bush administration will not reach a consensus in the ASML-SVG merger by the midnight deadline, institutional investors yesterday appeared to be selling off their shares in the two lithography companies--and quickly, according to sources in the industry.

"The deal is at risk," said one analyst on Wall Street. Calls to ASML, SVG, and various U.S. government agencies were not returned.

Last October, ASML announced plans to buy SVG for $1.6 billion to become the world's largest supplier of lithography systems for semiconductor production.

The acquisition was apparently moving ahead to be finalized in the first quarter, but then it was suddenly delayed when Committee on Foreign Investment notified the companies that it was conducting a 45-day review of the proposed purchase because of potential national security concerns (see March 8 story).

That review appeared to be going along smoothly for the ASML-SVG merger, but at the start of April a non-profit group in Washington, called the U.S. Business and Industry Council, began circulating a video tape that shows lithography experts against the sale of SVG and its leading-edge technology to the Dutch company. About 650 copies of the controversial 15-minute tape were sent to leaders in Congress and U.S. government officials, including President Bush (see April 13 story).

ASML and SVG officials have called the tape a last-ditch effort to stop the purchase, which has received the endorsement of Intel Corp. and other U.S. chip makers as well as the Semiconductor Industry Association (SIA).

Yesterday, a U.S. interagency panel called CFIUS was supposed to form a consensus on ASML's takeover of SVG. CFIUS is an Executive Branch body with representatives from various departments, including State, Defense, Treasury, Commerce and others.

Then, CFIUS is supposed to make a recommendation to the Bush administration, which will then make its final ruling.But officials in the Bush administration are still apparently wrestling with the proposed sale.