Broadcom Pledges $1.5 Billion Fund to Salvage Qualcomm Deal

Broadcom Pledges $1.5 Billion Fund to Salvage Qualcomm Deal

Foto: Fotolia

Broadcom said it plans to create a new $1.5 billion fund to ensure America’s lead in future wireless technology, responding to U.S. government concerns that the proposed takeover of Qualcomm could hurt its competitiveness and threaten national security, according to Bloomberg.

The Committee on Foreign Investment in the U.S. is investigating the $117 billion offer by Broadcom on national seucurity grounds, an unusual move that threatens to derail what would be the biggest deal in the history of technology. In a letter explaining the grounds for investigation, Treasury cited Qualcomm’s “expertise and research and development expenditure,” which drives its ability to set standards for 5G. Treasury noted that a Broadcom takeover would possibly reduce long-term investment to focus on short-term profitability.

In a statement Broadcom said, “with its proven track record of investing in and growing core franchises, Broadcom is committed to making the U.S. the global leader in 5G.” The new fund Broadcom is proposing would focus on innovation to train and educate the next generation of engineers in the U.S., ensuring America’s lead in future wireless technology, it said.

Broadcom also took a swipe at Qualcomm’s licensing business, which is a subject of dispute between the companies. “Broadcom will fund enhanced R&D through lawful business practices rather than predatory and anticompetitive behavior,” the statement said. “There is no truth to Qualcomm’s argument that its anticompetitive licensing practices are needed to fund a robust R&D effort.”

Singapore-based Broadcom also reiterated that it plans to shift its headquarters to the U.S. no later than May. 6, a move it has argued should not make it subject to a review on national security concerns. If it achieves its goal of acquiring Qualcomm, Broadcom said it expects to have more than 25,000 employees in the U.S.

More from category

Huawei and Partners Launch New ICT Competition

Huawei and Partners Launch New ICT Competition

23 Jun 2018 comment

Huawei officially launched Huawei ICT Competition 2018-2019 at the CEBIT 2018 in Hannover, Germany.

Mercedes-AMG Petronas Motorsport Partners with HPE

Mercedes-AMG Petronas Motorsport Partners with HPE

23 Jun 2018 comment

Mercedes-AMG Petronas Motorsport announced a new partnership with HPE to enhance the team’s operational efficiency, car performance and overall technology capability.

Zuckerberg on Brink of Eclipsing Buffett With Facebook at $200

Zuckerberg on Brink of Eclipsing Buffett With Facebook at $200

23 Jun 2018 comment

Facebook co-founder Mark Zuckerberg is poised to leapfrog Warren Buffett to become the world’s third-richest person, according to Bloomberg.