National Security Concerns Means the Broadcom Bid to Acquire Qualcomm Has Been Temporarily Stopped

Donald Trump halts Broadcom Qualcomm deal

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Less than 24 hours have passed that we reported the plans of Broadcom to shift its headquarters to the U.S. to simplify the Qualcomm acquisition but a massive wall stands in the way of the Wi-Fi chip manufacturing giant. Donald Trump has issued a presidential order which has halted the takeover of Qualcomm for the time being. Qualcomm is going to be one of the few important tech companies that lay the foundation for 5G penetration. The U.S. certainly does not want a key figure like this to end up in the wrong hands for now.

National Security Concerns Highlighting Huawei and China Came to Mind When Talking About the Bid to Takeover Qualcomm

Donald Trump on Monday issued a presidential order which detailed that no merger between Qualcomm and Broadcom was going to take place.

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“The proposed takeover of Qualcomm by the Purchaser (Broadcom) is prohibited, and any substantially equivalent merger, acquisition, or takeover, whether effected directly or indirectly, is also prohibited.”

Intel might breathe a sigh of relief because sources close to the industry stated that the processor manufacturing giant would end up with its own offer to takeover Broadcom should the merger with the latter and Qualcomm had been successful.

While the key terms being used to temporarily put a halt to the deal were National Security concerns, other matters included the U.S. military and entities having to make use of Huawei equipment in the future should the deal have gone through. According to a source that Reuters cited, if the merger had been successful, in the next 10 years, the U.S. military might have ended up relying on Huawei hardware to maintain communications.

The Chinese tech firm was barred from selling its smartphones through carriers over security problems and we believe that this presidential order was issued due to some involvement of Huawei in some manner.

Keep in mind that the decision from Donald Trump cannot be appealed since it is a presidential order, and Broadcom’s executives have not stated their intentions on what they will end up doing next. The company will eventually be carrying out its operations in the U.S. very soon, so we’ll be updating you on what the chipmaker’s next plan of action is going to be.

News Source: Reuters

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