A national security panel that can stop mergers that could harm US security has begun looking at Singapore-based Broadcom Ltd’s plan to take over rival chipmaker Qualcomm Inc, three sources familiar with the matter said.
The the Committee on Foreign Investment in the US (CFIUS), an opaque interagency panel, has been in touch with at least one of the companies in the proposed merger, one source said, and last month met to discuss the potential merger of the two big semiconductor companies, two sources familiar with the matter said.
US Senator John Cornyn, the No. 2 Republican in the US Senate, on Monday urged US Secretary of the Treasury Steven Mnuchin to have CFIUS officially review the proposed transaction before a key shareholder vote expected on Tuesday next week, according to a letter seen by Reuters.
The pre-deal discussions by CFIUS — which are extremely rare — suggest Broadcom’s plans to move its headquarters to the US before it completes its proposed purchase of Qualcomm might not be enough to sidestep a national security review that could threaten the deal.
Part of CFIUS’ concern, which is echoed in Cornyn’s letter, could lie in the fact that Broadcom has failed to strike a deal with Qualcomm and has resorted to what is essentially a hostile takeover by putting forward a slate of six Broadcom nominees for Qualcomm’s 11-member board.
If the six are elected on Tuesday, the vote would give control of Qualcomm to Broadcom’s nominees. That would happen before a CFIUS review or anti-trust review is complete.
“I urge CFIUS to promptly review Broadcom’s proposed acquisition of control of Qualcomm’s board, and to act prior to the March 6 Qualcomm meeting to address any national security concerns that may be identified,” Cornyn wrote to Mnuchin in the letter.
A spokesman for CFIUS declined to comment.
A CFIUS review in itself does not mean a deal will be halted. CFIUS, under US President Donald Trump and former US president Barack Obama, has soured on high-tech deals, particularly involving semiconductors, or involving sensitive information about US citizens.
Microprocessor expert Linley Gwennap of the Linley Group said that Qualcomm had world-leading chips in several areas.
“Qualcomm is a crown jewel of the American semiconductor industry,” he said. “I would think that CFIUS would be very protective of that... Singapore is nominally a friendly country, but it still seems dangerous for that level of technology to go overseas.”
Singapore-based Broadcom struggled to win CFIUS approval to buy Brocade Communications Systems Inc late last year.
In the end, that approval came just weeks after Broadcom CEO Hock Tan (陳福陽) announced in an Oval Office ceremony with Trump that Broadcom would return its headquarters to the US.
Broadcom declined to comment on the CFIUS process for this deal, but reiterated that it intends to move forward with its move to the US after receiving approval to do so, which is expected on May 6.
SEEKING CLARITY: Washington should not adopt measures that create uncertainties for ‘existing semiconductor investments,’ TSMC said referring to its US$165 billion in the US Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) told the US that any future tariffs on Taiwanese semiconductors could reduce demand for chips and derail its pledge to increase its investment in Arizona. “New import restrictions could jeopardize current US leadership in the competitive technology industry and create uncertainties for many committed semiconductor capital projects in the US, including TSMC Arizona’s significant investment plan in Phoenix,” the chipmaker wrote in a letter to the US Department of Commerce. TSMC issued the warning in response to a solicitation for comments by the department on a possible tariff on semiconductor imports by US President Donald Trump’s
The government has launched a three-pronged strategy to attract local and international talent, aiming to position Taiwan as a new global hub following Nvidia Corp’s announcement that it has chosen Taipei as the site of its Taiwan headquarters. Nvidia cofounder and CEO Jensen Huang (黃仁勳) on Monday last week announced during his keynote speech at the Computex trade show in Taipei that the Nvidia Constellation, the company’s planned Taiwan headquarters, would be located in the Beitou-Shilin Technology Park (北投士林科技園區) in Taipei. Huang’s decision to establish a base in Taiwan is “primarily due to Taiwan’s talent pool and its strength in the semiconductor
Industrial production expanded 22.31 percent annually last month to 107.51, as increases in demand for high-performance computing (HPC) and artificial intelligence (AI) applications drove demand for locally-made chips and components. The manufacturing production index climbed 23.68 percent year-on-year to 108.37, marking the 14th consecutive month of increase, the Ministry of Economic Affairs said. In the first four months of this year, industrial and manufacturing production indices expanded 14.31 percent and 15.22 percent year-on-year, ministry data showed. The growth momentum is to extend into this month, with the manufacturing production index expected to rise between 11 percent and 15.1 percent annually, Department of Statistics
An earnings report from semiconductor giant and artificial intelligence (AI) bellwether Nvidia Corp takes center stage for Wall Street this week, as stocks hit a speed bump of worries over US federal deficits driving up Treasury yields. US equities pulled back last week after a torrid rally, as investors turned their attention to tax and spending legislation poised to swell the US government’s US$36 trillion in debt. Long-dated US Treasury yields rose amid the fiscal worries, with the 30-year yield topping 5 percent and hitting its highest level since late 2023. Stocks were dealt another blow on Friday when US President Donald
RSS