Monday, February 27th 2017

US-Gov Looking into National Security Implications of Broadcom-Qualcomm Merger

The United States Government is closely examining national security implications of a potential Broadcom-Qualcomm merger. Broadcom is a Singapore-based company, while Qualcomm is American. An empowered national security panel called the Committee on Foreign Investment in the United States (CFIUS), which has the legal power to stop mergers between American and foreign companies, and acquisitions of American companies by foreign entities; is said to be examining specifics of Qualcomm's high-technology and intellectual property falling into the hands of Broadcom, as the two companies close in on a crucial Qualcomm board meet scheduled for March, in which Broadcom has exercised its shareholding to plant 6 favorable board members among the 11-member Qualcomm board, which all but guarantees a vote in favor of the merger - a classic hostile takeover.

"Not so fast," believes Senator John Cornyn, the No. 2 Republican in the US Senate, who urged Treasury Secretary Steven Mnuchin to have the CFIUS examine the Broadcom-Qualcomm deal. In its unprecedented pre-deal discussions within the otherwise opaque committee, a consensus emerged that Broadcom's decision to relocate its headquarters to the US was insufficient to circumvent a CFIUS review. "I urge CFIUS to promptly review Broadcom's proposed acquisition of control of Qualcomm's board, and to act prior to the March 6 Qualcomm meeting to address any national security concerns that may be identified," Senator Cornyn wrote to Secretary Mnuchin. It looks like Broadcom's decision to tamper with Qualcomm's board is set to spectacularly backfire.
Source: Reuters
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4 Comments on US-Gov Looking into National Security Implications of Broadcom-Qualcomm Merger

#1
lexluthermiester
Considering that Qualcomm is a technology supplier to several defense and national security government entities, the take-over/merger is unlikely to succeed. Broadcom may as well pack their bags and go home now.
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#2
Capitan Harlock
You know how is going to end up? Someone else is going to acquire broadcom and than acquire qualcom a says that everything is all right because reasons with another person on the top chair.
This is Murica way.
When they want something they say every time this and than , put a pawn on top and everything become all right .
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#3
Nomad9000
There should be no merger. Why in the hell do they think its okay to do this? It will be so destructive.
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#4
lexluthermiester
Nomad9000 said:
There should be no merger. Why in the hell do they think its okay to do this? It will be so destructive.
You're a bit late to the proceedings. Pres. Trump issued an executive order prohibiting the merger and ending the debate.
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