Broadcom ends bid for Qualcomm after President Trump nixes deal

Broadcom ends bid for Qualcomm after President Trump nixes deal

Broadcom ends bid for Qualcomm after President Trump nixes deal

President Trump has nixed Singapore-based Broadcom's purchase of the American chipmaker Qualcomm on national security and protectionist grounds, although Broadcom had promised to relocate to the United States.

"Although we are disappointed with this outcome, Broadcom will comply with the Order", The company said in a statement.

President Trump's order prohibiting Broadcom from taking over Qualcomm is all about China, especially Huawei.

But if the decision was prompted by Trump's deep skepticism about global trade and Fortress America instincts, that is less defensible and could haunt USA companies in their worldwide dealings.

Deal opponents, including the Committee on Foreign Investment in the United States, were concerned that Qualcomm would fall under the control of an Asian company that operates within China's sphere of influence.

In a letter, the CFIUS had confirmed the national security concerns. Qualcomm has scheduled its annual stockholders meeting for March 23. "Trump's decision" could further rattle the global economy and worldwide norms" if other countries choose to block US investment as a retaliatory measure.

"The CFIUS process focuses exclusively on identifying and addressing national security concerns".

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"Other countries might now feel emboldened to block as a security threat inbound foreign investment that they consider significant, justifiably or not", the Times said.

China is said to be the main reason behind Trump's decision, U.S. daily "The New York Times" said.

Further, Donald Trump ordered that both Qualcomm and Broadcom must "immediately and permanently abandon the proposed takeover".

"This should concern us as a nation".

On Monday, President Donald Trump signed an order that halted what would have been the largest technology acquisition in history.

These actions signal the Trump administration's aggressive review posture for Chinese (and other) foreign investment into USA technology firms under an ever evolving, expanding view about national security. Earlier this month, the committee branded the proposed deal a potential security risk that could hobble the U.S.'s ability to make the smooth and quick transition to 5G.

While Broadcom pursues Qualcomm and Intel waits, Qualcomm has also put a cash offer on the table to acquire another chipmaker, Netherlands-based NXP Semiconductors.

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