By Michael Liedtke & Zeke Miller
WASHINGTON (AP) --President Donald Trump blocked Singapore chipmaker Broadcom from pursuing a hostile takeover of U.S. rival Qualcomm, ruling the proposed combination would imperil national security.
The decision, announced late Monday, abruptly ends Broadcom's four-month, $117 billion bid to buy Qualcomm — a deal that would have been the largest ever completed in the technology industry.
In a statement, Broadcom said it "strongly disagrees" that the acquisition raises any national-security concerns. Qualcomm did not immediately respond to a request for comment.
Trump's order gives Broadcom few options other than to drop its bid, said Macquarie Securities analyst Srinivas Pajjuri.
Broadcom faced challenges almost from the start of its quest. Qualcomm quickly spurned its unsolicited suitor and continued to resist even after Broadcom raised its original offer from $103 billion.
Broadcom's Singapore connections complicated matters, even though the company maintained its physical headquarters in Silicon Valley and virtually all of its shareholders are in the U.S.
The Trump administration nevertheless balked at the prospect of a prominent U.S. chipmaker being owned by a foreign company, particularly at a time countries around the world are gearing up to build ultra-fast "5G" mobile networks that could tip the balance of power in technology.
Although its name isn't widely known outside the technology industry, Qualcomm is one of the world's leading makers of the processors that power many smartphones and other mobile devices. Qualcomm also owns patents on key pieces of mobile technology that Apple and other manufacturers rely upon in their products.
Qualcomm is fending off allegations in complaints filed by Apple and government regulators around the world that it has abused the power of its mobile patents to throttle competition and charge excessive royalties for its technology.
Broadcom CEO Hock Tan had seized on Qualcomm's legal headaches in his attempt to persuade the U.S. government to keep the deal alive. "Qualcomm faces a number of challenges that hamper its role in developing 5G," Tan wrote in a letter sent to U.S. Congress last week. Unlike Qualcomm, Tan said, Broadcom financed its innovation through "lawful practices."
Trump decided to squelch Broadcom's bid on the recommendation of the Committee on Foreign Investment in the United States, which reviews foreign purchases of U.S. entities.
The decision didn't come as a surprise. Earlier this month, the committee branded the proposed deal a potential security risk that could hobble the U.S.'s ability to make the smooth and quick transition to 5G.
In an attempt to ease those worries, Broadcom last week pledged to make the U.S. a leader in the race to build 5G networks, saying it would create a $1.5 billion fund to support the effort if took control of Qualcomm.
Broadcom also tried to curry favor by moving its legal headquarters from Singapore to the U.S within the next few weeks.
Singapore became Broadcom's legal home two years ago after it was sold to Avago, a company that once was part of Silicon Valley pioneer Hewlett-Packard.
Broadcom's company's physical headquarters is already in San Jose, California — about 450 miles from Qualcomm's headquarters in San Diego.
Trump hosted Broadcom's Tan in the White House last year when the executive announced the proposed move.
Now that Broadcom has been shoved aside, Qualcomm will be under pressure to prevent its stock price from sinking while trying to complete its own proposed takeover — a proposed $43 billion purchase of NXP Semiconductors.
"Now it's on (Qualcomm's) management to deliver on what they promised," Pajjuri said.
Liedtke reported from San Francisco. AP Technology Writer Ryan Nakashima in San Francisco contributed to this story.
After 20 Years of Acting, Megan Park Finds Her Groove In The Director’s Chair On “My Old Ass”
Megan Park feels a little bad that her movie is making so many people cry. It's not just a single tear either — more like full body sobs.
She didn't set out to make a tearjerker with "My Old Ass," now streaming on Prime Video. She just wanted to tell a story about a young woman in conversation with her older self. The film is quite funny (the dialogue between 18-year-old and almost 40-year-old Elliott happens because of a mushroom trip that includes a Justin Bieber cover), but it packs an emotional punch, too.
Writing, Park said, is often her way of working through things. When she put pen to paper on "My Old Ass," she was a new mom and staying in her childhood bedroom during the pandemic. One night, she and her whole nuclear family slept under the same roof. She didn't know it then, but it would be the last time, and she started wondering what it would be like to have known that.
In the film, older Elliott ( Aubrey Plaza ) advises younger Elliott ( Maisy Stella ) to not be so eager to leave her provincial town, her younger brothers and her parents and to slow down and appreciate things as they are. She also tells her to stay away from a guy named Chad who she meets the next day and discovers that, unfortunately, he's quite cute.
At 38, Park is just getting started as a filmmaker. Her first, "The Fallout," in which Jenna Ortega plays a teen in the aftermath of a school shooting, had one of those pandemic releases that didn't even feel real. But it did get the attention of Margot Robbie 's production company LuckyChap Entertainment, who reached out to Park to see what other ideas she had brewing.
"They were very instrumental in encouraging me to go with it," Park said. "They're just really even-keeled, good people, which makes... Read More