President Donald Trump on Monday blocked Broadcom Ltd.’s $117 billion hostile bid for Qualcomm Inc., capping a remarkable series of moves by the Trump administration reflecting officials’ concerns about an intensifying arms race between the U.S. and China over advanced technologies.
While Broadcom is a Singapore-based company, the U.S. panel that vets foreign deals said that the bid could have had implications for the U.S.’s broader technological competition with China. That panel, the Committee on Foreign Investment in the U.S., known as CFIUS, said it was worried that Broadcom would stymie research and development at Qualcomm given its reputation as a cost-cutting behemoth. CFIUS said such a move could weaken Qualcomm—and thereby the U.S.—against foreign rivals racing to develop next-generation wireless technology known as 5G, such as China’s Huawei Technologies Co.
Broadcom, which launched its hostile bid for Qualcomm in November in what could have become the technology industry’s biggest-ever deal, was working to redomicile in the U.S. to evade the panel’s review. But the presidential order effectively ended its acquisition hopes.
Broadcom, which has said it would invest in Qualcomm’s 5G technology if a deal went through, said late Monday it was reviewing the order. “Broadcom strongly disagrees that its proposed acquisition of Qualcomm raises any national security concerns,” it said in a statement.
I suspect the picture below was from the "Broadcom is bringing jobs back to the USA" days....
Broadcom Chief Executive Hock Tan stood with Mr. Trump at the White House in November to announce that Broadcom planned to redomicile in the U.S. Mr. Trump called Mr. Tan “a great, great executive” and said Broadcom was “one of the really great, great companies.”
Now, Mr. Trump’s order leaves Broadcom little choice but to move on. Broadcom’s options are “not many, and not good,” said Michael Gershberg, an attorney with Fried, Frank, Harris, Shriver & Jacobson LLP, who has experience with CFIUS cases. “There may be avenues for the companies to work together in other kinds of arrangements, but anything that looks like Broadcom controls Qualcomm, especially around the 5G business, CFIUS will be alert to.”