Broadcom's Qualcomm takeover plans pose national security risk, US Treasury says

Posted:
in iPhone
The U.S. government considers there to be possible national security risks in Broadcom's proposed $117 billion acquistion of Qualcomm, enough to warrant a full-scale investigation, the U.S. Treasury's deputy assistant secretary for investment security said in a letter to the two Apple suppliers.




Specifically the government is concerned about Broadcom's connections with foreign parties, Aimen Mir wrote in the letter, seen by Reuters. He did not however explain who the parties might be.

The missive follows the Treasury's Committee on Foreign Investment (CFIUS) issuing an order for Qualcomm to delay a shareholders meeting 30 days. Broadcom is hoping to get six friendly nominees elected to Qualcomm's board of directors, paving the way for a hostile takeover.

One source told Reuters that CFIUS may be motivated by concerns in the U.S. military that if Broadcom buys Qualcomm, China's Huawei may indirectly be able to gain dominance in 5G cellular development. Huawei is known to have close ties to the Chinese government, which could in turn use control of 5G as a strategic advantage.

Apple depends on Qualcomm for cellular chips, but the two companies are also embroiled in a global legal battle over patents and royalties. A Broadcom buyout of Qualcomm could prove beneficial to Apple, both for the chance of ending lawsuits and possible supply deal benefits.

Broadcom is currently based in Singapore, but is in the process of relocating its corporate headquarters to the U.S.
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Comments

  • Reply 1 of 30
    I guess they’re payed to be paranoid...

    But, Qualcomm isn’t the only company working 5G...
  • Reply 2 of 30
    jimh2jimh2 Posts: 64member
    This is no different the situation faced by the country with steel. At some point we will be down to one company or dependent upon another country to supply us steel.
  • Reply 3 of 30
    KuyangkohKuyangkoh Posts: 242member
    Bad for competitions.....stop the deal. 
    Qualcomm can do it and will surely settled w Apple
  • Reply 4 of 30
    avon b7avon b7 Posts: 3,065member
    The US obsession with Huawei again.

    "Huawei is known to have close ties to the Chinese government"

    Huawei has always strongly denied any such ties so I don't know how it can be 'known' to have them.

    In fact, it has been denying it since at least 2011.







    edited March 2018 [Deleted User]
  • Reply 5 of 30
    dachardachar Posts: 330member
    The Qualcomm story over the last few months certainly makes for an interesting read. The latest twist shows that it is impossible to predict the final outcome yet. Once the dust has settled l hope Daniel E Dilger will write a piece about it in his usual way. 
    tex210
  • Reply 6 of 30
    foggyhillfoggyhill Posts: 4,767member
    So, basically, Qualcom stock can't be sold... according to this, not sure shareholders will love this.
  • Reply 7 of 30
    maestro64maestro64 Posts: 4,370member
    avon b7 said:
    The US obsession with Huawei again.

    "Huawei is known to have close ties to the Chinese government"

    Huawei has always strongly denied any such ties so I don't know how it can be 'known' to have them.

    In fact, it has been denying it since at least 2011.








    What do you know about Huawei, just because the deny something does not make it false or true. Huawei existed long before china because more capitalistic, they were a government own and run business for a long time. Huawei, only exist to copy what other companies are doing in the world. They are one of the worse entities of stealing IP.
    edited March 2018 randominternetpersoncornchipanantksundaram
  • Reply 8 of 30
    avon b7avon b7 Posts: 3,065member
    maestro64 said:
    avon b7 said:
    The US obsession with Huawei again.

    "Huawei is known to have close ties to the Chinese government"

    Huawei has always strongly denied any such ties so I don't know how it can be 'known' to have them.

    In fact, it has been denying it since at least 2011.








    What do you know about Huawei, just because the deny something does not make it false or true. Huawei existed long before china because more capitalistic, they were a government own and run business for a long time. Huawei, only exist to copy what other companies are doing in the world. They are one of the worse entities of stealing IP.
    I know they insist government ties do not exist. 

    In that case, if another party claims that it is known that ties do exist that party should at least substantiate the claims.

    Isn't that a reasonable position?

    At the start of the decade I remember the same claims but when the committee in question was pressed to clarify, the reply was in the line of "while no wrongdoing was found..."

    Of course that really means that nothing was actually 'known', simply 'feared'.


    [Deleted User]
  • Reply 9 of 30
    StrangeDaysStrangeDays Posts: 6,259member
    avon b7 said:
    The US obsession with Huawei again.

    "Huawei is known to have close ties to the Chinese government"

    Huawei has always strongly denied any such ties so I don't know how it can be 'known' to have them.

    In fact, it has been denying it since at least 2011.
    So if people willingly trust that US intelligence agencies have good reason to believe russians meddled in the election (without every giving any proof of it), why should we not also believe they have good reason to know something about Huawei that you don’t? 

    Because you like their phones? 
  • Reply 10 of 30
    avon b7avon b7 Posts: 3,065member
    avon b7 said:
    The US obsession with Huawei again.

    "Huawei is known to have close ties to the Chinese government"

    Huawei has always strongly denied any such ties so I don't know how it can be 'known' to have them.

    In fact, it has been denying it since at least 2011.
    So if people willingly trust that US intelligence agencies have good reason to believe russians meddled in the election (without every giving any proof of it), why should we not also believe they have good reason to know something about Huawei that you don’t? 

    Because you like their phones? 
    I trust that "having good reason to believe Russians meddled" was deliberately worded so as to avoid saying "Russians are known to have meddled".

    Perhaps they did but I'm sure something could be plunked on the table to point that way if it were known.
  • Reply 11 of 30
    k2kwk2kw Posts: 1,521member
    Has anyone from Broadcom said that they will lower Qualcomm's licensing fees?   I've never seen anything to that effect.   Seems like wishful thinking from Apple Fans.
    muthuk_vanalingamGeorgeBMac
  • Reply 12 of 30
    avon b7 said:
    The US obsession with Huawei again.

    "Huawei is known to have close ties to the Chinese government"

    Huawei has always strongly denied any such ties so I don't know how it can be 'known' to have them.

    In fact, it has been denying it since at least 2011.
    So if people willingly trust that US intelligence agencies have good reason to believe russians meddled in the election (without every giving any proof of it), why should we not also believe they have good reason to know something about Huawei that you don’t? 
    that's actually a reason NOT to believe the US intelligence agencies over Russian allegations. Innocent until proven guilty is the supposed idea western countries are to go by, it's quite the opposite nowadays. Just like the Russian double-agent poisoned in London this week, even the government is blaming Russia and Putin directly before ANY facts have been proven, I really wonder how long Russia (and China) will sit back and keep taking these jabs before they bite back.
  • Reply 13 of 30
    avon b7 said:
    maestro64 said:
    avon b7 said:
    The US obsession with Huawei again.

    "Huawei is known to have close ties to the Chinese government"

    Huawei has always strongly denied any such ties so I don't know how it can be 'known' to have them.

    In fact, it has been denying it since at least 2011.








    What do you know about Huawei, just because the deny something does not make it false or true. Huawei existed long before china because more capitalistic, they were a government own and run business for a long time. Huawei, only exist to copy what other companies are doing in the world. They are one of the worse entities of stealing IP.
    I know they insist government ties do not exist. 

    In that case, if another party claims that it is known that ties do exist that party should at least substantiate the claims.

    Isn't that a reasonable position?

    At the start of the decade I remember the same claims but when the committee in question was pressed to clarify, the reply was in the line of "while no wrongdoing was found..."

    Of course that really means that nothing was actually 'known', simply 'feared'.


    Really? How do you propose that US investigators go about getting this data? Just ask Huawei nicely?

    You know what happened when they did that the last time? (Hint: “Chinese state secrets.”). Get real.

    There’s a real blizzard coming, wait and see. There’s going to be a sweeping indictment of China and Chinese companies stealing intellectual property rights coming from this US Administration. It’ll make the steel/aluminum tariffs look like peanuts.
  • Reply 14 of 30

    avon b7 said:
    avon b7 said:
    The US obsession with Huawei again.

    "Huawei is known to have close ties to the Chinese government"

    Huawei has always strongly denied any such ties so I don't know how it can be 'known' to have them.

    In fact, it has been denying it since at least 2011.
    So if people willingly trust that US intelligence agencies have good reason to believe russians meddled in the election (without every giving any proof of it), why should we not also believe they have good reason to know something about Huawei that you don’t? 

    Because you like their phones? 
    I trust that "having good reason to believe Russians meddled" was deliberately worded so as to avoid saying "Russians are known to have meddled".

    Perhaps they did but I'm sure something could be plunked on the table to point that way if it were known.
    Stop the useless parsing of words. At this point, it is known. Period. 13 Russian nationals have been indicted.
  • Reply 15 of 30
    GeorgeBMacGeorgeBMac Posts: 3,402member
    jimh2 said:
    This is no different the situation faced by the country with steel. At some point we will be down to one company or dependent upon another country to supply us steel.
    That actually already happened back in the 70's & 80's...   By the 90's the American steel industry was a  hollow shell of what it once was -- basically a few specialty steel makers and fabricators.  The fact is:  we had the largest steel making capacity in the world -- but it couldn't compete with foreign imports because: 
    -- Labor costs were too high
    -- Management too inept (they spent on diversification rather than modernizing their plants)
    -- Environmental controls too tight

    They tried to save it with protective tariffs, but that effort failed...
    The result was:   Steel production moved to Japan (who supplied better, cheaper steel) and later into other (mostly Asian) countries...
  • Reply 16 of 30
    GeorgeBMacGeorgeBMac Posts: 3,402member
    avon b7 said:
    The US obsession with Huawei again.

    "Huawei is known to have close ties to the Chinese government"

    Huawei has always strongly denied any such ties so I don't know how it can be 'known' to have them.

    In fact, it has been denying it since at least 2011.







    LOL.... That's why we have intelligence agencies...  To find stuff out that foreign adversaries don't want us to know...
  • Reply 17 of 30
    GeorgeBMacGeorgeBMac Posts: 3,402member
    foggyhill said:
    So, basically, Qualcom stock can't be sold... according to this, not sure shareholders will love this.
    No, this has nothing to do with "selling Qualcomm stock".
    It has to do with the formation of monopolies and ties to foreign governments that could harm our country
  • Reply 18 of 30
    GeorgeBMacGeorgeBMac Posts: 3,402member
    avon b7 said:
    maestro64 said:
    avon b7 said:
    The US obsession with Huawei again.

    "Huawei is known to have close ties to the Chinese government"

    Huawei has always strongly denied any such ties so I don't know how it can be 'known' to have them.

    In fact, it has been denying it since at least 2011.








    What do you know about Huawei, just because the deny something does not make it false or true. Huawei existed long before china because more capitalistic, they were a government own and run business for a long time. Huawei, only exist to copy what other companies are doing in the world. They are one of the worse entities of stealing IP.
    I know they insist government ties do not exist. 

    In that case, if another party claims that it is known that ties do exist that party should at least substantiate the claims.

    Isn't that a reasonable position?

    At the start of the decade I remember the same claims but when the committee in question was pressed to clarify, the reply was in the line of "while no wrongdoing was found..."

    Of course that really means that nothing was actually 'known', simply 'feared'.


    The claims of ties to the Chinese government aren't being made by "another party".   They have been made by U.S. Intelligence for many years....   What we don't want is China furnishing the U.S. with essential tech equipment that is controlled by the Chinese government and that can be used for spying or simply disruption.  
    As Mike Pompeo the head of the CIA recently said:   Even though Russia attacked this country in 2016 and plans to do so again in 2018, we should fear China even more...
  • Reply 19 of 30
    GeorgeBMacGeorgeBMac Posts: 3,402member
    avon b7 said:
    The US obsession with Huawei again.

    "Huawei is known to have close ties to the Chinese government"

    Huawei has always strongly denied any such ties so I don't know how it can be 'known' to have them.

    In fact, it has been denying it since at least 2011.
    So if people willingly trust that US intelligence agencies have good reason to believe russians meddled in the election (without every giving any proof of it), why should we not also believe they have good reason to know something about Huawei that you don’t? 

    Because you like their phones? 
    They provided that proof...
    Please try to keep up....
  • Reply 20 of 30
    GeorgeBMacGeorgeBMac Posts: 3,402member
    avon b7 said:
    avon b7 said:
    The US obsession with Huawei again.

    "Huawei is known to have close ties to the Chinese government"

    Huawei has always strongly denied any such ties so I don't know how it can be 'known' to have them.

    In fact, it has been denying it since at least 2011.
    So if people willingly trust that US intelligence agencies have good reason to believe russians meddled in the election (without every giving any proof of it), why should we not also believe they have good reason to know something about Huawei that you don’t? 

    Because you like their phones? 
    I trust that "having good reason to believe Russians meddled" was deliberately worded so as to avoid saying "Russians are known to have meddled".

    Perhaps they did but I'm sure something could be plunked on the table to point that way if it were known.
    It's on the table....  Along with the 13 Russians indicted for their meddling...
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