President Trump orders block of Broadcom acquisition of Qualcomm
Late last year, Broadcom made an offer to buy Qualcomm for $130 billion. The deal was rejected by Qualcomm, but since then, rumors about Broadcom making another offer have been swirling. Now it looks like any potential deal has been blocked.
President Trump today issued an order to block any potential acquisition of Qualcomm by Broadcom. "The proposed takeover of Qualcomm by the Purchaser (Broadcom) is prohibited, and any substantially equivalent merger, acquisition, or takeover, whether affected directly or indirectly, is also prohibited," the order reads.
Trump's order goes on to say that there's "credible evidence" that through purchasing Qualcomm, Broadcom "might take action that threatens to impair the national security of the United States". The president adds that he reserves the authority to make further orders regarding Broadcom and Qualcomm "as shall in my judgment be necessary to protect the national security of the United States".
Reports have said that Huawei had deals with AT&T and Verizon for the carriers to sell Huawei's new flagship smartphone, but that the US government pressured AT&T and Verizon to abandon those deals over national security concerns. Now it sounds like a similar situation has played out for the Singapore-based Broadcom.
It's worth noting that Broadcom is working to redomicile to the US and that its acquisition of Qualcomm is premised on that move. In response to Trump's order, Broadcom told Bloomberg that it "strongly disagrees that its proposed acquisition of Qualcomm raises any national security concerns."