Groups Similar Search Look up By Text Browse About

Broadcom will relocate to U.S. by April 3 to speed security review of Qualcomm bid


Hoping to avoid a prolonged national security review, Singapore-based Broadcom said it will move its international headquarters back to the U.S. by April 3 as it continues a hostile takeover bid for rival Qualcomm. In a press release today, Broadcom confirmed the date for the first time while also emphasizing its roots in the U.S. Indeed, the whole snarled mess surrounding the notion of a foreign company buying a prize like Qualcomm goes right to the heart of what one means by U.S. company. Politicians are worried by the thought of an Asia-based company seizing control of Qualcomm, which is emerging as a leader in next-generation 5G chips. Qualcomms board has fought the bid since last November even as Broadcom raised the price to $121 billion. Last week, the U.S. Treasurys Committee on Foreign Investment in the United States (CFIUS) released a letter saying it was reviewing the transaction for national security risks, putting the deal temporarily on hold. This was not entirely surprising and was one of the reasons Broadcom announced at a ceremony with President Trump last November that it plans to relocate to the U.S. The company said in its press release today that it supports the CFIUS process and noted that the agency had previously reviewed and cleared its acquisition of Brocade in November 2017. At the close of that transaction, Broadcom agreed to relocate. The move to the U.S. will be a homecoming for a company that in many ways never really left. Broadcom began life in Irvine, California as a fabless semiconductor company. It was acquired in 2016 by Avago Technologies, which started as a product division of Hewlett-Packard and was spun off in 1999 into Agilent Technologies. After that deal, Avago renamed itself Broadcom and established joint headquarters in Singapore and San Jose. In many ways, what Broadcom refers to as a plan to redomicile to the U.S. is a largely symbolic move. The company hasnt said how many executives or what, if any, operations may be shifted. But it emphasized that it believes the change should eliminate any fears around national security. In short, U.S. national security concerns are not a risk to closing, as Broadcom never plans to acquire Qualcomm before it completes redomiciliation, the company said. Whether that does actually satisfy the CFIUS remains to be seen. Meanwhile, amid delays in reaching a deal, rumors have emerged that rival Intel is considering making a bid for Broadcom.

Trump issues order blocking Broadcom takeover of Qualcomm, citing national security


President Donald Trump issued an order Monday evening blocking any merger of the chipmaking giants Broadcom and Qualcomm, saying it was necessary to protect national security. There is credible evidence, the order says, that if the Singapore-based Broadcom took control of the US-based Qualcomm that the company might take action that threatens to impair the national security of the United States. Broadcom has been trying to purchase Qualcomm for the last several months, but has continually been rebuffed. Its since tried to stack Qualcomms board with friendly members. Trumps order says that Broadcom will not be allowed to purchase or merge with Qualcomm in any way, and that all of the people Broadcom has proposed to Qualcomms board are disqualified. It seems that Broadcom was aware that Trump or his Justice Department might attempt to block the merger on these grounds and has been trying to avoid it. Trump has blocked similar takeovers before, having stopped a Chinese state-owned company from buying an American semiconductor firm back in September. Broadcom is currently in the process of moving its headquarters from Singapore to the US, according to Bloomberg, and planned to complete the transition by April 3rd. With the move, Broadcom seems ready to fight Trumps order. In a statement, the company said US national security concerns are not a risk to closing, as Broadcom never plans to acquire Qualcomm before it completes redomiciliation. Its not clear whether thatll be allowed to happen. Trumps order says that the two companies should permanently abandon the proposed takeover, indicating that Broadcoms move wont make a difference, unless its willing to take the order to court.