NEWS

Trump Blocks Biggest Technology Takeover Bid

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Trump Blocks Biggest Technology Takeover Bid

US President Donald Trump on Monday blocked a planned takeover of chipmaker Qualcomm by Singapore-based rival Broadcom on grounds of national security.

His order cited "credible evidence" that the proposed $140 billion (£100 billion) deal "threatens to impair the national security of the US," report the BBC and The New York Times.

He is "sending a clear signal that he was willing to take extraordinary measures to promote his administration’s increasingly protectionist stance," according to The Times.

Trump’s decision to prohibit the blockbuster deal underscored the lengths that he is willing to go to shelter American companies from foreign competition. In recent weeks, the president has turned to an arsenal of tools — including tariffs and an obscure government review panel — to ward off foreign control in American industries and, in particular, thwart the rise of China.

There were concerns the takeover could have led to China pulling ahead in the development of 5G wireless technology.

The deal would have been the biggest technology sector takeover on record.

A takeover of Qualcomm by Broadcom would have created the world's third-largest maker of microchips, behind Intel and Samsung.

The chipmaking sector is in a race to develop chips for the latest 5G wireless technology and Qualcomm is considered to be a leader in this field, followed by Broadcom and China's telecoms giant Huawei.

"Trump’s decision to prohibit the blockbuster deal underscored the lengths that he is willing to go to shelter American companies from foreign competition. In recent weeks, the president has turned to an arsenal of tools — including tariffs and an obscure government review panel — to ward off foreign control in American industries and, in particular, thwart the rise of China," says The Times.

Image credit: BBC and Qualcomm