Broadcom drops Qualcomm takeover attempt following Trump order

Doris Richards
March 15, 2018

After a series of rejected purchase offers - which went as high as $121 billion - Broadcom finally lost their patience with negotiations and opted to attempt a hostile takeover, securing "up to" $100 billion in debt to cover the transaction.

Qualcomm continues to fall in the futures market, more than 5%, after collapsing on the eve 4% on the Nasdaq after US President Donald Trump made a decision to block the acquisition of US microprocessor manufacturer by rival Broadcom, .

Broadcom's efforts to acquire Qualcomm emerged as one of last year's most controversial business moves in mobile tech.

The company said it has also withdrawn its slate of independent director nominees for Qualcomm's annual shareholder meeting.

An investigation of the deal by the Committee on Foreign Investment in the USA, which reviews purchases of American businesses by foreign investors, confirmed national security threats related to the acquisition by Broadcom, the Treasury Department said in a letter to both companies made public March 12.

"Broadcom's board of directors and management team sincerely appreciate the significant support we received from the Qualcomm and Broadcom stockholders throughout this process", Broadcom said.

Unsurprisingly, Broadcom expresses its disappointment with its inability to proceed, but nevertheless acquiesces to the order. At one point, the company also offered to raise its offer for Qualcomm, and when CFIUS first raised concerns about the deal, Broadcom sent a letter to lawmakers promising it would not slow research and development in 5G networking technology if the merger were approved.

The US Treasury Department (which leads the Committee on Foreign Investment in the US) claims the Broadcom/Qualcomm threatens Qualcomm's future leadership within the next generation of wireless technology.

Though Broadcom has been blocked from buying Qualcomm, the company still plans on moving its headquarters from Singapore to the U.S.

Other reports by Iphone Fresh

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