News Worms
News Worms

U.S. committee might have issues with the Broadcom/Qualcomm deal

U.S. committee might have issues with the Broadcom/Qualcomm deal

DEPARTMENT OF THE TREASURY WASHINGTON, D.C. March 5, 2018 Mark Plotkin Covington & Burling LLP One CityCenter 850 lOth Street, N.W. Washington, DC 20001 Theodore Kassinger O'Melveny & Myers LLP 1625 Eye Street, N.W. Washington, DC 20006 Re: CFIUS Case 18-036: Broadcom Limited (Singapore)/Qualcomm Incorporated Dear Mr. Plotkin and Mr. Kassinger: On January 29, 2018, Qualcomm Incorporated ("Qualconnm") filed a unilateral notice with the Committee on Foreign Investment in the United States ("CF, IUS"), seeking review ofBroadcom. "Articulation of the potential national security concerns, in significant part, is classified".

On Monday, Broadcom called Qualcomm's latest actions an effort to prevent Qualcomm shareholders from expressing their views on the takeover proposal.

Advisers for Singapore-based Broadcom told a Qualcomm shareholder that the company is accelerating its plans to re-domicile to the US, The Post has learned.

Huawei is forging closer commercial ties with big telecommunication operators across Asia, the Americas and Europe, putting the company in prime position to lead the global race for wireless 5G networks, despite USA allegations it poses a security threat.

As CFIUS continues to investigate the deal, Qualcomm said it's delaying the shareholders' vote to elect new board members by at least 30 days.

Huawei has been forging closer commercial ties with big telecom operators across Europe and Asia, putting the company in prime position to lead the global race for 5G networks despite USA concerns.

CFIUS' intervention was unusual in that the panel typically reviews signed deals. CFIUS, under former President Barack Obama and current President Donald Trump, has soured on high-tech deals, particularly involving semiconductors, or involving sensitive information about American citizens. President Trump previous year blocked a Chinese-backed takeover of Lattice Semiconductor Corp. because of the importance of semiconductors to the U.S. government and China's role in the proposed acquisition.

Mr Cornyn said on Monday he was glad CFIUS made a decision to review the deal, noting aggression by " rivals, like China".

"I support the idea that the committee on foreign investment takes a close look at that to see that American interests are protected", he said.

Broadcom has been ratcheting up the pressure on shareholders of rival chipmaker Qualcomm this week - even as the landscape surrounding the hostile takeover becomes more tenuous.

Broadcom has struggled to complete its proposed deal to buy Qualcomm as the latter has resisted, citing concerns including the price offered and potential antitrust hurdles.

Qualcomm countered that the CFIUS inquiry was no surprise.

On that day, Broadcom Chief Executive Hock Tan stood in the White House and pledged to bring jobs to the USA - a move that won him praise from President Trump. First, Broadcom offered Qualcomm a takeover deal worth $103 billion.


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