Intel, Facing Threat, Considers Deals That Could Include Bid for Broadcom

Lynne Carty

Chip designer Intel could be considering a bid to acquire Broadcom to keep it from creating a powerhouse competitor, according to a report in The Wall Street Journal.

Broadcom manufacturers Wi-Fi chips for companies like Apple and if it acquires Qualcomm, it might even tone down the negative relationship taking place between Apple and the Snapdragon chipset manufacturer. The company's quarterly revenue was up 17.1% on a year-over-year basis. equities research analysts predict that Broadcom Ltd will post 17.41 earnings per share for the current year.

If it happens, however, it would continue an accelerating stream of mergers and acquisitions in the semiconductor industry. Last month, Qualcomm updated its offer to $44bn.

Intel is watching the takeover battle closely and is eager for Broadcom to fail as the combined company would pose a serious competitive threat, the people said.

Broadcom's move shows that - despite the CFIUS probe - it's not backing away from its effort to acquire San Diego's Qualcomm for $117 billion in what would be the largest semiconductor deal ever.

Among Intel's concerns is that the acquisition would allow Qualcomm to fix its frayed relationship with Apple - one which has fallen apart in recent years over licensing disputes.

WARNING: This news story was originally posted by and is owned by of What's more, Broadcom's products could both complement Intel's and provide the solid presence in mobile chips that has largely escaped Intel, whose heritage is personal computers and whose business remains centered on PCs and computer servers.

Intel had always been recognised as the world's dominant chip company, but previous year Samsung claimed that crown.

Perhaps foremost amongst them is that The Committee on Foreign Investment in the United States (CFIUS) could block the sale altogether, with the inter-agency committee citing national security matters.

Broadcom also has pledged lead in 5G wireless development and to step up its spending on research and development.

The fallout has left the deal of buyout open for everyone.

"Broadcom will not only maintain the R & D resources Qualcomm devotes to 5G and innovation in future wireless standards - we also will focus R & D spend to those critical technologies that are essential to the USA", the company said in a statement.

The deal's pushback on national security grounds is seen by some as trade posturing by the Trump administration against China. Nevertheless, the company has been preparing a range of fallback plans, including a possible acquisition of Broadcom itself. Once the move is done, Broadcom could argue that CFIUS does not have jurisdiction, the second expert said.

Moving back to the U.S. was something Broadcom CEO Hock Tan promised President Donald Trump during an Oval Office meeting on 2 November 2017.

In related news, insider Kirsten M. Spears sold 199 shares of the company's stock in a transaction dated Friday, March 2nd.

Acquisitions like these often reviewed by the respective United States regulatory authorities and if it has been witnessed that the deal could somehow compromise the best interests of the country, it is immediately turned down.

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