FBI Intervenes in Planned Sale Of Internet Service to Japanese

The FBI is raising national security concerns about a Japanese telecommunications giant's planned acquisition of a U.S. Internet company, as the agency seeks to maintain its ability to track criminals and terrorists in the digital age. According to sources familiar with its action, the FBI has intervened in the announced $5.5 billion acquisition of Englewood, Colo.-based Verio Inc. by NTT Communications, a subsidiary of Nippon Telegraph and Telephone Corp., which in turn is more than half-owned by the Japanese government.Verio is a major provider of Internet services to corporations. NTT Communications provides telecommunications services in more than 200 countries. On June 30, NTT Communications announced that it had received notice from the Committee on Foreign Investment in the United States (CFIUS), an interagency committee chaired by the Treasury secretary that examines foreign investment deals. "NTT Communications believes that the proposed transaction does not raise national security concerns," the company said in a statement. Neither the FBI nor the Treasury Department would comment on the matter, nor would spokesmen officially acknowledge that an investigation had been launched. Share prices of Verio dropped $1.62 1/2 yesterday, closing at $54.25.