Broadcom has been aggressively trying to make a bid for Qualcomm, manufacturer of Snapdragon processors. Qualcomm has rejected previous offers, but now the US government might be the biggest obstacle for that takeover.
The Committee on Foreign Investments in the United States, or CFIUS, is looking over the potential merger, which is pretty rare for these kinds of situations. They’ve asked Qualcomm to delay their March 6th shareholder meeting by 30 days while the investigation proceeds, so the next meeting will take place on April 5th.
The concerns from the US government come from the small number of companies that produce processors like Qualcomm. Within 10 years, the US military anticipates there would only be one major player in the space if the merger happens, which would likely be Huawei. In case you’ve missed it, the US government and military aren’t particularly fond of Huawei.
An investigation like this doesn’t necessarily mean that the deal can’t still happen, but with Qualcomm rejecting the purchase and Broadcom still pursuing it very aggressively, the US is taking that as a sign that everything needs to be reviewed considering the role Qualcomm indirectly plays in national security.
This has been on ongoing situation for months, but things are definitely likely to heat up soon now that government entities are poking around.