The blockbuster deal between Broadcom and Qualcomm appears to be dead. Due to national security concerns, President Donald Trump and the U.S. government issued an executive order preventing Broadcom from acquiring one of the biggest chipmakers in the world.
It’s been months since the two companies started negotiations but haven’t reached a deal for multiple reasons, and now they’ll be moving forward separately.
The offer initially came in at $130 billion. It would’ve been among the richest business transactions ever; however, Qualcomm’s leadership unanimously rejected the offer. Aside from demanding even more money, the company felt it was prepared for the future without Broadcom’s help.
It became clear that Qualcomm didn’t want to be acquired, so Broadcom launched a strategy that would lead to a takeover no matter what. But then the U.S. government decided to intervene.
Although it operates around the world, Broadcom is based in Singapore and the Trump administration hasn’t been too kind to companies in Asia. Just look at Huawei and ZTE, the former of which saw its flagship dropped from a major carrier’s lineup after pressure from lawmakers. There’s a growing concern within the nation’s capital that companies out of Asia are heading to the U.S. to obtain personal information and provide it to their own governments.
While Qualcomm merely issued a press release confirming President Trump’s decision, Broadcom put forth a statement saying it “strongly disagrees” and is reviewing the executive order.