Qualcomm rules out another bid for NXP

Ivan Schwartz
December 5, 2018

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.

Despite efforts from both and USA and China to simmer down the heightened trade tensions between world's biggest economies, it seems things aren't exactly playing out the way they were supposed to.

To put some context, Qualcomm had proposed a massive $44 Billion acquisition Dutch semiconductor maker NXP earlier in 2016.

President Trump, who met with Chinese President Xi Jinping over the weekend, said: "If that deal came back to [Xi], he would most likely approve it quickly, which is a big thing". Apparently, Qualcomm has pursued the acquisition of NXP for the company's strength in automotive chips in order to diversify beyond the smartphone field.

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

"Although that acquisition can not be resuscitated, Xi's comment reveals in plain sight that Chinese antitrust policy is inherently politicized", said Scott Kennedy, a China expert at the Center for Strategic and International Studies in a blog post.

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As of this writing, it is still not clear whether Qualcomm and NXP will pursue the merger again.

Qualcomm and NXP did not lobby for the Trump administration to bring up the abandoned deal in its meeting with Xi and other Chinese officials on the sidelines of the G20 summit in Buenos Aires on Saturday, which was dominated by negotiations over trade tariffs, according to sources close to the companies. Qualcomm even paid a $2 billion penalty in July for breaking off the merger.

A Qualcomm representative didn't immediately respond to a request for comment. It has spent more than US$20 billion in share buybacks in the last 12 months.

In July, Qualcomm scrapped plans for a $44bn (£34bn) takeover of NXP after Chinese regulators signalled that they would block the takeover.

NXP has also announced its own US$5 billion share buyback programme.

Other reports by GizPress

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