China-based Huawei cancelled a planned euro bond sale after the US Department of Justice (DoJ) opened an investigation into whether the equipment manufacturer violated US restrictions on trade with Iran.

The company scrapped what was scheduled to be its first euro-denominated bond sale after attracting strong demand for a €500 million offering of five-year debt, The Wall Street Journal (WSJ) reported.

Investors had placed more than €2 billion of orders for the bonds, and bankers had already released final pricing guidance, the newspaper said.

Huawei didn’t give a reason for canceling the bond sale, a money manager told WSJ. A Huawei representative said “in spite of the overwhelming responses” from investors, the company decided to put the bond issue on hold.

Bankers familiar with the situation said Huawei will likely remain sidelined until questions over the investigation are cleared up, WSJ reported.

Huawei could face criminal penalties if the DoJ determines it intentionally broke US laws.

Increasing pressure
After facing a de facto ban since 2012 on selling its network equipment to US operators due to security concerns by the government, Huawei’s bids to secure smartphone supply deals with AT&T and Verizon were dropped due to political pressure. Retailer BestBuy later also dropped the vendor’s devices.

Last week the US Department of Commerce imposed trade sanctions on rival ZTE for making false statements during settlement talks and a probationary period agreed in 2017 after the company pleaded guilty to charges it illegally shipped US goods to Iran in violation of trade sanctions.

A bill was introduced by the US Congress in January seeking to ban US government agencies from using phones and equipment from both Chinese companies.