China's antitrust watchdog remains the only competent regulator in the world that has yet to approve Qualcomm's proposed $44 billion acquisition of Dutch NXP Semiconductors, having forced the San Diego, California-based company to once again extend its cash tender offer for all of the firm's outstanding shares on Friday. The new deadline is set for Monday, April 2, and is likely to be extended as well, with China showing no indication of being close to approving the consolidation.
The matter has been additionally complicated by President Trump's recent order that put an end to the Qualcomm-Broadcom drama but also harmed the chances of China's Huawei to seize leadership in the global 5G sector. According to some industry watchers and Washington's official reasoning, Broadcom's track record with mergers and acquisitions implied the Singapore-incorporated firm was preparing to cut Qualcomm's R&D budget post-takeover in an effort to generate savings and start reaping larger profits that would allow it to recoup its investment in the shortest timeframe possible. Such a move wouldn't have aligned with the U.S. interests in the telecom industry and other segments, with the Treasury Department's national security panel which advised President Trump to block the consolidation claiming the development would provide an opening for Huawei to overtake Qualcomm in 5G R&D. Due to that state of affairs, the act of blocking the merger indirectly harmed the prospects of China's largest tech company, possibly making Beijing unwilling to accelerate Qualcomm's own M&A ambitions. According to recent reports, the Far Eastern country is now pushing the semiconductor firm to provide more economic protection to local companies before approving the deal, though the extent of its supposed demands remains unclear.
The NXP tie-up has been in the making since October of 2016 and Qualcomm's inability to close the deal in a timely manner may have prompted Broadcom to attempt a hostile takeover in the first place, according to some speculation alleging that the technology firm sensed corporate weakness on Qualcomm's part. Given how the company's attempted coup of Qualcomm's board has been progressing prior to Washington's intervention, such theories may have merit, with Broadcom coming close to seizing the majority voting power at the chipmaker before being told to cease its advances. The recently imposed tariffs on China's imports announced by President Trump earlier this week additionally complicate the matter and make a retaliatory block more likely, some analysts believe.