Qualcomm Refiles NXP Merger Notice In China With New Deadline

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Qualcomm refiled its NXP Semiconductors merger notice with the Ministry of Commerce in China (MOFCOM) at the request of the antitrust watchdog in the Far Eastern country, the tech giant said Thursday. The original consolidation filing that has been going nowhere since late 2016 has hence been withdrawn, with the new one also coming with a revised final deadline for the completion of the deal before Qualcomm must pay NXP the previously agreed termination fee amounting to $2 billion in cash, as the Dutch company revealed in a regulatory filing from early October. The last deadline for the conclusion of the tie-up is now July 25, whereas the previous one was set to expire next Wednesday, April 25.

The move shows NXP's willingness to continue working with Qualcomm on concluding the merger even as their proposed consolidation is still facing uncertainty, with China being the last party that has yet to approve the deal. Qualcomm's tender offer for all outstanding NXP shares has now also been extended to April 27. NXP stock continues to fall, with the negative trend starting in late February and the company currently trading at just under $113, whereas Qualcomm's bid stands at $127.50, or approximately $44 billion in total. The San Diego-based chipmaker's stock saw little changes over the last month, having ended NASDAQ trading on Wednesday above $55. Qualcomm hasn't clarified on what basis has MOFCOM requested the original notice to be withdrawn and refiled, with the ministry's official saying the initial review of the deal yielded concerns that are difficult to address earlier today. Beijing previously requested unspecified extra protections for local companies from Qualcomm, sources claimed earlier this year.

Some industry watchers are speculating China will use Qualcomm's proposed tie-up as means to retaliate for Washington's treatment of Huawei, increased tariffs on imported goods, and other trade moves that recently placed a new strain on relations between the world's two superpowers. Broadcom's attempted hostile takeover of Qualcomm that President Trump stopped earlier this spring is also understood to be frowned upon by Beijing as the tie-up could have allowed Huawei to take leadership in certain technology segments, as evidenced by Broadcom's track record of aggressive cost-cutting efforts following major M&A deals.

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Dominik started at AndroidHeadlines in 2016. He’s approaching his first full decade in the media industry, with his background being primarily in technology, gaming, and entertainment. These days, his focus is more on the political side of the tech game, as well as data privacy issues, with him looking at both of those through the prism of Android. Contact him at [email protected]

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