Qualcomm to refile China antitrust application for $44bn NXP takeover

BEIJING: US chipmaker Qualcomm will refile as early as Monday an application with the Chinese government to clear its $44 billion takeover of NXP Semiconductors, sources said, giving regulators more time to decide on the deal and averting a collapse.
The San Diego-based firm withdrew its earlier antitrust application on Saturday at the request of China’s commerce ministry, just days before the regulator’s April 17 deadline to decide on the transaction expires, the sources said.
Clinching the NXP takeover, the world’s biggest in the semiconductor sector, is crucial to Qualcomm, which is seeking to diversify its customer base and become the leading chip supplier to the fast-growing automotive market.
The US chipmaker has already received approval from eight of nine required global regulators to finalize the acquisition, with Chinese clearance the only one pending.
By refiling, Qualcomm will provide the Ministry of Commerce (Mofcom) potentially with another six-month window to review its application. It will be the second time Qualcomm would be refiling its antitrust application with Mofcom.
Analysts, however, said a decision by Mofcom on the deal is unlikely to come before trade and investment tensions between China and the United States are resolved.
“Qualcomm is going to have to wait for Washington and Beijing to resolve their differences before this deal is going to move forward,” said Erick Robinson, director of patent litigation and licensing at Beijing East IP.
Earlier this month, the administration of US President Donald Trump proposed $50 billion worth of tariffs on some 1,300 industrial, technology, transport and medical products to force changes in Beijing’s intellectual property practices.
Beijing immediately responded with a list of proposed duties of $50 billion on key American imports.
China’s isn’t blocking the deal, “but they are holding it hostage”, said Andrew Gilholm, director of analysis for China and North Asia at risk consultancy Control Risks, adding he had heard about Qualcomm’s application withdrawal and planned refilling. — Reuters