US semiconductor manufacturer Qualcomm Inc admitted that it had not informed Chinese authorities when it completed its acquisition of Israel’s Autotalks Ltd in June, China’s market regulator said yesterday.
The disclosure was made two days after China launched an antitrust investigation into Qualcomm, examining whether the US firm contravened Chinese regulations by not declaring some details of its acquisition of the Israeli chip designer.
Qualcomm did not immediately respond to a request for comment.
Photo: Reuters
The Chinese State Administration for Market Regulation (SAMR) said it informed Qualcomm in March last year that the deal requires approval by the regulator, and the US firm in the same month notified SAMR it would not pursue further.
However, Qualcomm in June this year completed the deal without informing the authority, the regulator said, adding that the chip company “acknowledged above facts,” based on which Beijing launched the antitrust probe.
Qualcomm’s shares fell more than 5 percent on Friday after US President Donald Trump threatened to hike tariffs against China and cancel a planned meeting with Chinese President Xi Jinping (習近平).
Beijing is targeting Qualcomm, which has technology that is key to smartphones and networking, in the run-up to talks between Trump and Xi. Both countries are maneuvering for leverage ahead of the expiration of a US-China trade truce — even at the risk of escalating tensions.
Apart from Qualcomm, Chinese regulators also announced an investigation into Nvidia Corp’s 2020 acquisition of networking gear maker Mellanox Technologies Ltd. That probe was unveiled just as Beijing and Washington officials sparred over trade and other issues during wide-ranging negotiations in Madrid about a month ago.
Nvidia, which is caught in the middle of the two nations’ export controls negotiations, slid nearly 5 percent on Friday.
Friday’s announcement also drove shares in Alphawave IP Group PLC about 6.5 percent lower in London. Qualcomm is in the process of buying the company in a US$2.4 billion deal struck earlier this year.
Additional reporting by Bloomberg
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