Published: Tue, March 13, 2018

Intel considers possible bid for Broadcom

Intel considers possible bid for Broadcom

In an attempt to head off a potentially painful bit of probing by the Committee on Foreign Investment in the United States (CFIUS), the Singapore chipmaker will don a fresh pair of Stars and Stripes to prove it does not present a national security concern.

If Broadcom was successful in its bid to acquire Qualcomm, the combined company would have a valuation of around $220bn, closing in on Intel's $245m, which means the combined company would pose a much bigger threat to Intel in the chip market.

The company said previous year it's buying Israeli self-driving auto technology maker Mobileye NV for about $15 billion. "This will ensure America's lead in future wireless technology", the company said.

Broadcom shares jumped as much as 8.3 percent to $275 in extended trading in NY. "They committed to investing in 5G for 12 months".

The move is far from guaranteed, people familiar with the matter cautioned, but Intel has been considering the acquisition since late a year ago and is working with advisors.

Broadcom invests differently than Qualcomm, said McGregor.

The news comes as Broadcom aggressively pursues its bid for Qualcomm.

Broadcom announced intentions to purchase Qualcomm, but the company rejected the offers even when the total value of the deal reached $117 billion.

"That investigation has so far confirmed the national security concerns that CFIUS identified to you in its letter on March 5, 2018".

CFIUS has the power to block acquisitions on national security grounds.

CFIUS had delayed Qualcomm's annual meeting by a month to April 5. It doesn't usually begin a probe until a deal has been struck.

Bid bonanza: Meanwhile, as the chip market continues to consolidate, Qualcomm is also in the midst of organizing its own takeover offer for NXP, a Dutch company that's a leader in chips for connected and self-driving vehicles. Most Qualcomm board members and employees regarded the acquisition as a fait accompli in view of Broadcom's strong will and the business integration trend in the industry.

Broadcom is based in Singapore, which gives CFIUS jurisdiction to investigate. Broadcom is now headquartered in Singapore, but is in the process of relocating its legal base to the United States to allay those issues.

Broadcom said on Friday it expected to complete its move to the United States by May 6. The Company operates through four segments: Wired Infrastructure, Wireless Communications, Enterprise Storage, and Industrial & Other. While Intel could not carve a niche for itself in the smartphone SoC space, conceding it to Qualcomm, the chipmaker has resolved to invest heavily in upcoming 5G technologies.

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