Published: Wed, December 05, 2018
Business | By Eloise Houston

Qualcomm-NXP deal could be back on

Qualcomm-NXP deal could be back on

The American chip manufacturer Qualcomm no longer sees any salvation in an acquisition of its Eindhoven-based industry partner NXP.

Qualcomm, the world's biggest smartphone-chip maker, walked away in July from the mammoth deal to buy NXP after failing to secure Chinese regulatory approval, becoming a high-profile victim of the China-US trade dispute.

According to Qualcomm, the deadline for any transaction has expired thus terminating any deal.

Qualcomm told Reuters that although it welcomed the development, the deadline for the deal to be completed had passed and it had no interest in resurrecting the deal.

"Qualcomm considers the matter closed", a Qualcomm spokesman said.

Qualcomm itself was a takeover target for Broadcom earlier in the year, but Trump blocked the proposed $140 billion attempt on national security grounds.

That may mean that NXP's board "could be open to the idea" of an acquisition if they are presented with another offer from Qualcomm, the analysts said. The deal however did not go through and was called off in July this year, due to a roadblock created by Chinese regulatory bodies.

NXP did not immediately respond to an emailed request for comment on Monday.

The statement about revisiting Qualcomm-NXP was included in the White House release, but not the one from the China side. Since Qualcomm has significant ties with Chinese OEMs, the chip maker had no choice but to agree with China's decision. It has spent more than $20 billion (roughly Rs. 1.4 lakh crores) in share buybacks in the last 12 months. To appease its shareholders, Qualcomm has also embarked on a $30 billion (roughly Rs. 2.1 lakh crores) stock repurchase plan to return to them most of the money that would have been used for the NXP deal.

Regulators in eight countries approved the deal, including in the US and Europe.

"If that deal came back to him, he would most likely approve it quickly, which is a big thing", said Trump according to reports from Buenos Aires.

United States lawmakers also passed reforms earlier this year that increased CFIUS' scrutiny of deals.

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