March 24, 2018

Broadcom pledges $1.5 billion fund to salvage Qualcomm deal

08 March 2018, 01:34 | Kara Nash

Qualcomm takeover bid halted by US government

Qualcomm shareholder meeting pushed forward by a month

The review will be conducted by the Committee on Foreign Investment in the United States (CIFUS), a body chaired by the US Treasury that can recommend deals be blocked.

Now, with Qualcomm using the CFIUS investigation as reason to push back the shareholder vote on the acquisition until at least April, Broadcom is launching its own charm offensive and pledging to pour money into the USA research and education fields with its $1.5bn fund promise. However, many of Qualcomm's rivals, including Huawei Technologies Co Ltd, are Chinese.

It seems the US government is concerned over the possibility that Chinese companies can obtain the 5G technology of the a result of Broadcom's acquisition of Qualcomm. It wants to make sure Qualcomm does not lose its status as a dominant player in wireless chip technology, according to a source familiar with the panel's thinking.

The investigation by CFIUS, which considers national security risks to foreign acquisitions of United States companies, came after Qualcomm filed a notice with the panel seeking a review. Besides, the U.S. Congress is planning to give more power to the CFIUS.

Last month, USA semiconductor testing company Xcerra Corp said CFIUS had blocked its $580 million sale to a Chinese state-backed semiconductor investment fund.

U.S. Sen. John Cornyn of Texas, as well as San Diego Congressmen Scott Peters, D-San Diego, and Duncan Hunter, R-Alpine, sent letters to Trump Administration officials requesting a CFIUS review.

Mudslide Fears Prompt Mandatory Evacuations for Montecito, Other Burn Areas
The storm will continue to bring showers to Southern California into Saturday according to forecasters. Other areas impacted by the order were Goleta, Santa Barbara, Montecito, Summerland and Carpinteria.

"Qualcomm is a leader in 5G technology, which is going to be the new standard in the future".

The deal was expected to face tough scrutiny from competition regulators. The move showed an uncharacteristic sense of urgency, as reviews are usually triggered after deals have been agreed to.

It's been an extremely busy couple of months for both Qualcomm and Broadcom, as the latter continues to pursue a hostile takeover. Qualcomm's board has rejected the offer, and a few days ago it urged shareholders to reelect its members at the annual shareholder meeting that had been scheduled for March 6.

"It should be clear to everyone that this is part of an unprecedented effort by Qualcomm to disenfranchise its own stockholders", said Broadcom. But the day before, Qualcomm said the vote had to be put on hold; a government committee led by the US Treasury Secretary needed time to investigate a potential merger.

"The rules say that one party alone could approach CFIUS and for a review", said McDermott Will & Emery LLP regulatory lawyer David Levine. "Broadcom has been interacting with CFIUS for weeks and made two written submissions to CFIUS". The company is now based in Singapore, but said in November that it will move its legal headquarters back to the United States.

Other News

Trending Now

Son double leads Tottenham past Huddersfield in EPL
Alli's fine pass split the Huddersfield defence wide open and Son took his time to round Lossl before slotting into an empty net.

Amazon Founder Jeff Bezos Reaches Top Spot As Wealthiest Billionaire
Amazon founder and CEO Jeff Bezos is the richest person on the planet and the first centi-billionaire in our annual ranking. She is India's richest self-made woman and was ranked 629th on the list with a fortune of Dollars 3.6 billion.

Sharma holds onto lead at WGC Mexico
Sharma blasted his opening tee shot two feet from the cup for a tap-in eagle. "To be honest, I'm actually relaxed now", he said. A victory at the WGC Championship would make Sharma the first debutant to win on the PGA Tour in about three decades.

USA sues California over pro-immigrant laws
Brown issued a statement Tuesday night that called the federal lawsuit "SAD!" and a political stunt. The state has defiantly refused to help federal agents detain and deport undocumented immigrants.

Ex-Donald Trump's campaign aide rejects Russian Federation probe subpoena
He also said he would not give investigators old campaign emails, which he has been ordered to hand over in a subpoena. Former Trump campaign chairman Paul Manafort filed a lawsuit in January challenging Mueller's authority to indict him.

Irish leader remains wary about border solution after Brexit
John McDonnell insisted this morning that the United Kingdom can negotiate new trade deals whilst remaining in a customs union with the European Union .

32 killed in Gujarat road accident
Authorities have announced financial aid of 400,000 rupees ($6,148) to the family of each of the deceased. You all know that the accident took place near Ranghola on Rajkot-Bhavnagar state highway.

Billy Graham to be laid to rest after a final crusade
Graham, who preached to millions in person and through mass media televangelism, was being laid to rest at his Charlotte home. As his oldest son told the funeral congregation, "There weren't two Billy Grahams".

North Korea Continues to Make Progress on Missile Program - US Intelligence
Meanwhile, Senator Lindsey Graham said on Thursday that any damage caused by a war with North Korea would be " worth it ". President Donald Trump responded by saying talks will happen only "under the right conditions".

CDC report: Opioid overdoses spike 30 percent across nation
The nation has not taken the next steps needed to help people deal with either opioid addiction or chronic untreated pain. From July 2016 through September 2017, opioid overdoes "increased for men and women, all age groups, and all regions".