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Broadcom, however, is scouring the order, stating that it "strongly disagrees that its proposed acquisition of Qualcomm raises any national security concerns".

Shares of San Diego-based Qualcomm are down 8% so far in 2018, while shares of Broadcom are down about 1.6%.

At the heart of that decision to scupper what would've been the largest technology acquisition in history is Huawei Technologies Co, the world's third-largest maker of smartphones and, by some reckonings, the biggest producer of telecommunications equipment. However, Broadcom is known for its track record of cutting research and development, and concerns exist that a merger could threaten the R&D output of Qualcomm and allow Chinese companies to pull ahead.

"I recently made this public pledge: Broadcom is committed to making the United States the global leader in 5G", Broadcom CEO Hock Tan said in a letter last week to Congressional leaders.

The president concurs. And so endeth the proposed union of Qualcomm and Broadcom, a brief shining dream that nobody seems to have wanted, no one seems to have thought would do anybody much good, and which came with risks to national security that left everyone in the room cold. A scenario in which China dominates 5G wireless equipment, with potential security repercussions for the USA, is a major concern of the Trump administration.

USA security agencies have recently reiterated the country's long-running national security concerns about Chinese technology companies such as Huawei and ZTE, and advised companies and individuals not to buy their products.

Huawei has been forging closer commercial ties with big telecom operators across Europe and Asia, putting it in prime position to lead the global race for 5G networks despite US concerns. Another concern, from a broader industry perspective, is that a united Broadcom Qualcomm entity could control approx 65 per cent of the bill-of-materials that goes into smartphone handsets.

As such, Broadcom and Qualcomm "shall immediately and permanently abandon the proposed takeover", ordered the US President.

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The takeover, which would have been the largest transaction the technology industry had ever seen, was tripped up by concerns that it posed a threat to American competitiveness in mobile technology by putting one of the largest mobile chip makers in the USA under the control of a company based in Asia.

This is the fifth time a USA president has blocked a deal based on CFIUS objections and the second deal Trump has stopped since assuming office slightly over a year ago.

Yesterday in a surprise move President Trump blocked Broadcom's proposed takeover of Qualcomm.

Last night's presidential order marked the latest twist in President Donald Trump's "America First" strategy, which has also seen the White House impose tariffs on imports of foreign steel and aluminum, and block a China-connected company's planned acquisition of USA -based Lattice Semiconductor on national security grounds.

"The national security concern is really more of national interest concern", said Chushek Chan, an analyst at research company Dealogic.

Intel's Broadcom deal alone would be worth $170 billion, according to Barron's, and that's without the successful Broadcom acquisition of Qualcomm.

Over the next couple of days, Broadcom bent over backwards to please CFIUS and other critics of the deal. It is not a solicitation to make any exchange in commodities, securities or other financial instruments.


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