SCREEEECH: US national security agency puts brakes on Qualcomm takeover

CFIUS sends Broadcom deal TITSUP* for 30 days

By Richard Speed

Posted in Business, 5th March 2018 14:05 GMT

American national security bods on the US government's Committee on Foreign Investment in the United States (CFIUS) have asked Qualcomm to delay tomorrow’s vote on Broadcom’s proposed $117bn (£84.7bn) takeover.

With a timing to make even the most imaginative soap opera writer slap a palm to face and mutter "steady on now, people", the CFIUS order placed a 30-day hold on proceedings at the very last minute. This derails, temporarily at least, Broadcom’s acquisition ambitions.

The ongoing saga of Broadcom's attempts to acquire Qualcomm began late last year, with an initial offer of $103bn, which Qualcomm angrily rejected. An increasingly disbelieving world has since been subjected to the offer being raised and then dropped again following Qualcomm's acquisition of Dutch chipmaker, NXP.

Broadcom had already reacted negatively to CFIUS taking an interest in the deal and appears to be throwing its metaphorical toys out of its pram at this latest development.

In a statement issued today, Broadcom described the CFIUS development as “engagement theater” aimed at deferring the will of the Qualcomm stockholders.

It said: "Broadcom was informed on Sunday night that on January 29, 2018, Qualcomm secretly filed a voluntary request with CFIUS to initiate an investigation, resulting in a delay of Qualcomm's Annual Meeting 48 hours before it was to take place. This was a blatant, desperate act by Qualcomm to entrench its incumbent board of directors and prevent its own stockholders from voting for Broadcom's independent director nominees."

The Singapore-based chip maker insists that upon completion of its redomiciliation to US shores by May 6, the deal will no longer be covered by CFIUS. Also, Broadcom state its board and senior management are mostly American.

So that’s ok then.

CFIUS takes a particular interest in transactions that it feels could harm US national security interests.

The transfer of San Diego-based Qualcomm’s technology to Broadcom would appear to have met that criteria for the time being at least.

With Broadcom turning the rhetoric up to 11 in this increasingly bitter battle for control, The Register has contacted Qualcomm for comment and awaits the response with interest. ®

*TITSUP = Toys Intentionally Thrown Straight Under Pram

Sign up to our NewsletterGet IT in your inbox daily

14 Comments

More from The Register

Qualcomm disappointed by Broadcom's 'inadequate' shrinking package

Snapdragon giant confirms: Size really does matter

Now Europe is getting jitters over Broadcom's Qualcomm takeover bid

Lawmakers express concern about data protection

Broadcom confirms anti-trust probe, professes zero worries

Says probe doesn't impact wireless lines, leaving about a gazillion other products in play

Broadcom's buyout of Qualcomm bogs down as DC blocks merger

'Great, great company' to 'security risk' in six months

Broadcom, you've been punk'd: Qualcomm puts stockholder vote on hold for US security probe

It was your plan all along! 'Oh no it wasn't.' Oh yes it was. 'CFIUS is BEHIND you!'

Qualcomm asks Broadcom over for lunch and a proper chat about being bought

Brushes off latest $121bn bid as too low, too risky, but is willing to discuss deal

Broadcom moves to the US: CFIUS-inspired redomiciling makes for happy voters

... even though the sound of it to Qualcomm's quite atrocious

Broadcom baits hook with promise of $1.5bn investment fund to catch Qualcomm

Telco promises to pump big bucks into 5G if US signs off on merger

Qualcomm rejects Valentine's Day takeover love-in with Broadcom

Cheapo merger terms wouldn't get past regulator, it says

US national security agency sniffs around Broadcom bid for Qualcomm – reports

No one expects the CFIUS! *Bless you*