Trump blocks Broadcom's United States dollars 117 billion bid to buy Qualcomm

Trump blocks Broadcom's United States dollars 117 billion bid to buy Qualcomm

Broadcom has formally withdrawn its takeover offer for Qualcomm after U.S. president Donald Trump issued a rare presidential order blocking the deal.

President Trump issued an executive order Monday blocking the impending takeover of Qualcomm by Broadcom Limited.

Supporting his decision to block the deal, Donald Trump said there is "credible evidence" that Broadcom and its affiliates "might take action that threatens to impair the national security of the United States".

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In a statement, Broadcom said that it would comply with Trump's order, formally abandoning what would have been the biggest takeover in the history of the technology industry.

The US president argued that the operation, which could have been the largest in the technology sector, "threatened to harm US national security".

Broadcom's months-long attempt to takeover Qualcomm is officially over following yesterday's intervention by the White House.

"This decision is based on the facts and national security sensitivities related to this particular transaction only and is not meant to make any other statement about Broadcom or its employees, including its thousands of hardworking and highly skilled United States employees", Mnuchin said.

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The plan had been to take the company public again, but weak sales have prevented that from happening. But that is down from an estimated 21% market share in fiscal 2013, according to IBISWorld.

Broadcom Ltd., the Singapore-based company that spent much of the past four months attempting to acquire fellow chip maker Qualcomm Inc., on Thursday said quarterly profit surged as it booked a one-time benefit of almost $6 billion tied to the USA tax overhaul.

Citing unnamed "people familiar with the matter", The Wall Street Journal yesterday reported that should Broadcom appear likely to take over Qualcomm, Intel "could step in with its own offer for Broadcom".

Broadcom had been pursuing Qualcomm for about four months. Qualcomm had rejected Broadcom's unsolicited offer in February before the government stepped in. Singapore-based Broadcom, on the other hand, disagrees with Trump's decision, saying its acquisition of Qualcomm does not pose any security risk.

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.

As of now, it is not clear if such a move from the Singapore-based company will win Trump's approval.

Decision by the President for forbidding the blockbuster agreement underscored the lengths and is willing to go for sheltering the Americans companies from the foreign competition.

Also, a few months back, Huawei said it failed to strike a deal with a USA carrier (believed to be AT&T) to sell its smartphones.

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