The US government just put an end to Broadcom’s interest in taking over Qualcomm

Back in November in an unexpected story, we learned about Broadcom’s interest in acquiring Qualcomm if the price was right. Qualcomm rejected the initial offer of $130 billion, but Broadcom never gave up and continued coming back with other ideas. However, the two don’t seem like they’ll be negotiating an acquisition anymore since the US Government essentially just blocked any takeover from happening.

For the first time in many years, we’ve seen the US Government get involved with companies and topics we talk about often here on Droid Turf. Those being, net neutrality, smartphone manufacturer Huawei, and now chip-maker Qualcomm. Qualcomm is a very large and successful company and is the one that makes the Snapdragon processors used in many Android smartphones and wearables.

We never expected a deal between the two chip producers in the first place considering how large and disruptive it would be. But to make sure a buyout does not happen, US President Trump issued an executive order on March 12, killing the potential multi-billion dollar deal.

The reasoning behind the block is a matter of US national security. The US Government does not want Broadcom (not a US company) to takeover Qualcomm as the result would be Chinese OEMs dominating the market. The US Government doesn’t want to risk Chinese spying, the same reason it doesn’t want you to buy a Huawei smartphone in the US. This was basically the same reason US carriers declined to approve Huawei’s Mate 10 Pro for sale, but that’s getting into a whole different chain of events.

Broadcom is not happy about the block, which should be expected. Qualcomm has not yet commented. We’re probably better off that the two competitors will remain separate business entities. If we hear anything further, we’ll let you know, but I’d expect chatter to quiet down now that a deal can’t be arranged.

SOURCE [Bloomberg]

About Doug Demagistris 1627 Articles
Doug Demagistris is the Founder and current Editor In Chief of Droid Turf. He grew up in New York and now attends Bryant University where he is studying marketing and communication. He has been and always will be a Google enthusiast thanks to Android’s customization, flat design and exceptional integration with various Google services. Currently, Doug uses a Pixel 2 XL as his daily driver for its unique design, powerful hardware, exceptional camera, and stock experience. For shorter instances, he’ll glance at his Huawei Watch. And for more productive work, you’ll find him typing away on his Pixelbook. Doug is hopeful his productivity will make lives easier, more meaningful and help down the road.