US President Donald Trump has barred Singapore-based Broadcom’s unsolicited attempt to take over US-based telecommunications company Qualcomm, the White House announced on Monday.
Trump made the call to block the takeover following a recommendation from the Committee on Foreign Investment in the United States (CFIUS), which assesses foreign purchases of US entities.
“There is credible evidence that leads me to believe that Broadcom … through exercising control of Qualcomm … might take action that threatens to impair the national security of the United States,” a White House statement quoted Trump as saying.
Read more: Qualcomm turns down higher Broadcom offer
In the statement, Trump ordered both companies to “immediately and permanently abandon the proposed takeover.”
Broadcom’s $121-billion (€98 billion) bid for the US smartphone chipmaker would have been the most expensive takeover to occur in the technology industry.
Trump met with Broadcom CEO Hock E. Tan at the White House last year as he announced the company’s move to the US
Takeover blocked amid HQ move
Broadcom is currently in the process of moving its legal headquarters to the United States, which is set to be completed by April 3 ahead of a planned Qualcomm shareholder vote on the takeover deal.
Broadcom said its move to the US meant national security concerns would have no longer been a problem for closing the deal.
“In short, US national security concerns are not a risk to closing, as Broadcom never plans to acquire Qualcomm before it completes redomiciliation,” the company said in a statement.
Broadcom’s Singapore connections and China’s potential future influence over the US chipmaker raised concerns when the unsolicited takeover deal was announced last November.
Qualcomm is one of the world’s leading makers of processors that power smartphones and other mobile devices. They also hold patents for technology that Apple and other mobile device manufacturers rely on for their products.
rs/cmk (AP, AFP, dpa, Reuters)