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Broadcom has moved back to the U.S. from Singapore, which could allow it to circumvent the mighty power of the Committee on Foreign Investment in the United States (CFIUS), which blocked its takeover attempt of Qualcomm last month. The company's co-headquarters in San Jose, California will become the sole headquarters of the redomiciled company:
Broadcom said on Wednesday it had completed its move back to the United States from Singapore, weeks after President Donald Trump blocked its $117 billion offer to buy Qualcomm on national security grounds.
Broadcom, which was a U.S. company until it was bought in 2016 by Singapore's Avago, had announced its plan to redomicile on Nov. 2, days before making its first offer for Qualcomm.
[...] The move to the United States could allow Broadcom to buy U.S. companies without coming under the scrutiny of the Committee on Foreign Investment in the United States (CFIUS), which has the power to stop deals that could harm national security.
Broadcom had already agreed with CFIUS to redomicile as a condition of approval for its acquisition of Brocade Communications. Knowing this, CFIUS still blocked Broadcom's attempt to acquire Qualcomm:
[Mergers and acquisitions (M&A)] bankers see a crafty defence being conducted by Qualcomm here: first innocently just checking if CFIUS approval for the unsolicited bid might still be needed, even as Broadcom proceeded to redomicile, and then lobbying hard.
"There was every likelihood that Broadcom would win the proxy fight," says an M&A banker at a different firm. "But it appears that Qualcomm has turned over the US Defense Department." This banker continues: "Remember, Broadcom does not have an unusual share register with any controlling Chinese shareholders."
The conclusion of many bankers is that Qualcomm raised enough concerns that the bidder might take such an aggressive, private equity-style, cost-cutting approach to the target's research and development budget, that it might let China's Huawei steal a march in developing 5G telecoms technology.
You may recall that Broadcom's letter to Congress following the block mentioned that the company was committed to making the United States the global leader in 5G.
Also at Nasdaq.
Related: U.S. Government Reportedly Wants to Build a 5G Network to Thwart Chinese Spying
(Score: 2) by PartTimeZombie on Friday April 06 2018, @01:12AM (2 children)
Ahh yes, making sure the right people get rewarded for voting the right way.
What a way to run a country.
(Score: 4, Informative) by captain normal on Friday April 06 2018, @04:58AM (1 child)
What? Don't you know we have the best congress and administration that money can buy?
The Musk/Trump interview appears to have been hacked, but not a DDOS hack...more like A Distributed Denial of Reality.
(Score: 1) by nnet on Friday April 06 2018, @08:06PM
apparently not as they're still on 4g.
(Score: 5, Insightful) by fishybell on Friday April 06 2018, @01:15AM (3 children)
Considering the ease at which companies can change "headquarters," trying to prevent companies from merging based solely on the country of origin of the acquiring company is inherently a losing game.
Say Microsoft for whatever reason decided to buy Qualcomm. The FTC and Trump would have no reason to block such a merger. Microsoft could then just a easily reincorporate in Singapore as Broadcomm did and suddenly all the fears of the "oh noes! it's owned by a foreign company!" crowd are realized.
(Score: 4, Insightful) by Fluffeh on Friday April 06 2018, @04:26AM (1 child)
No, not at all. At that point everyone is quiet and hopes that no-one else notices. This is politics. You don't have to do the right thing - you just can't be seen doing the wrong thing.
(Score: 2) by cmdrklarg on Friday April 06 2018, @05:37PM
Ah yes, the Eleventh Commandment: Thou shalt not get caught.
The world is full of kings and queens who blind your eyes and steal your dreams.
(Score: 1) by pTamok on Friday April 06 2018, @08:30AM
I agree.
The location of the jurisdiction under which the company is incorporated (gains legal personhood) is probably less important than the nationalities and locations of the members of the board, and the nationalities and locations of key staff.
A company can be incorporated in Luxembourg, but operate in the USA; or be incorporated in Delaware and have operations spread all over the globe. Location and staff allegiances count. In this case, from a national security point of view, some of the questions to ask would be:
1) Where are the fabs?
2) What are the actual locations and allegiances of key staff.
(Score: 5, Insightful) by Anonymous Coward on Friday April 06 2018, @02:03AM (2 children)
Really though, what is this "nation" thing to a multinational megacorp with shareholders and offices around the world?
(Score: 2, Informative) by anubi on Friday April 06 2018, @06:06AM (1 child)
As long as the US Military will back up their wishlist, it only makes sense to do center your business elsewhere and use the United States as your enforcement agent, while avoiding US tax. Just common business sense.
This is gonna be great until the people of the United States wise up and decide in unison that this has got to stop.
Not apt to happen though... the people are quite docile, and for the most part law abiding...
"Prove all things; hold fast that which is good." [KJV: I Thessalonians 5:21]
(Score: 0) by Anonymous Coward on Sunday April 08 2018, @03:11PM
From what I see very many of those dumb sheeple with guns who claim they need their guns to fight Tyranny will be queuing to use their guns to support Tyranny when a suitable Tyrant arrives.
(Score: 2) by MichaelDavidCrawford on Friday April 06 2018, @02:24AM (1 child)
"This is a big shift for us to take a lot more responsibility."
Yes I Have No Bananas. [gofundme.com]
(Score: 1, Informative) by Anonymous Coward on Friday April 06 2018, @10:31PM
That is the same man who calls people who hand them information 'dumb fucks'. This is not a 'come to jesus' moment for him. It is just someone trying to stop the hemorrhaging. Look for more 'changes' that do not really change anything. They are an advertising company. Their lifeblood is our information. It is core to their company. The only thing that will change is *who* gets the information. Basically a big do nothing...
(Score: 1, Disagree) by Runaway1956 on Friday April 06 2018, @02:32AM (8 children)
Despite his many apparent stupidities, Trump understands the importance of loyalty. A certain FBI guy was made very uncomfortable by Trump's harping on loyalty. He was eventually fired, in part, for his disloyalty. Here, Broadcom has displayed disloyalty to the US in the past. It will need to establish some minimal level of loyalty to gain any governmental favor in the future. There are fences to mend, acts of contrition to perform, and more.
Put it on a personal level. One spouse leaves, then years later decides he/she wants to return. Does the other spouse just say, "Oh, alright, welcome home!" Will life be just like it was before the spouse left? Highly unlikely.
I'm going to buy my defensive radar from Temu, just like Venezuela!
(Score: 5, Informative) by PartTimeZombie on Friday April 06 2018, @02:38AM (2 children)
But is too stupid to understand that the loyalty he was asking for was to the office, not him personally.
That sort of loyalty is what dictators ask for.
(Score: 4, Interesting) by Anonymous Coward on Friday April 06 2018, @05:35AM (1 child)
Rather, any manager. What we are seeing in the Trump administration, is how things work day-to-day in our nation's companies. A CEO with maybe his heart in the right place, but no domain knowledge. Managers that get and retain their jobs based on connections and the favor they enjoy with their boss. Bosses that play favorites with managers and their competitors to prevent anyone from becoming too powerful, or to shake out the weak. An endless supply of people trying to throw the manager off his chair, so that they can try and do it better. Tons of technical peons who may have political reservations with the way the "company" is going, but nobody gives a fuck about them.
Is that worse than business as usual in politics, where there may have been more collegial respect due to the skeletons in each others closets? Don't know.
(Score: 0) by Anonymous Coward on Friday April 06 2018, @10:19PM
People are not paying Hillary 1/10th of her usually speaking prices because she still has the mojo. It is gone. Trump obliterated it.
(Score: 0) by Anonymous Coward on Friday April 06 2018, @10:34AM
"Broadcom, which was a U.S. company until it was bought in 2016 by Singapore's Avago"
How is that anything to do with loyalty? It was bought, it didn't just move to Singapore.
(Score: 2) by TheGratefulNet on Friday April 06 2018, @01:28PM
100% disagree. everyone - ultimiately gets screwed by trump when they think they invested and found a friend in him. EVERYONE gets screwed by trump, just a matter of time.
he will turn on you. its what he does. he thinks only of himself.
only the really stupid ones still think they can trust trump and he'll 'have your back'. nothing is farther from the truth.
"It is now safe to switch off your computer."
(Score: 0) by Anonymous Coward on Friday April 06 2018, @08:09PM (1 child)
wanna bet drumpf will be out of office long before broadcom ever stops being a business?
(Score: 0) by Anonymous Coward on Friday April 06 2018, @10:25PM
Why would they stop being a company? Do you know something we dont? The one they were trying to acquire has seen 4 presidents so far. Probably will see a few more. Or were you trying to be snarky? OHHHH thats why you called him Drumpf. A poor copy of a stale jon stewart joke? Maybe you can talk about lasers on fricken sharks while you are at it.
(Score: 0) by Anonymous Coward on Friday April 06 2018, @10:17PM
It is honestly best long term for both companies. I as a shareholder voted against it. The big funds that own a majority stake voted for it. So the resolution passed.
It was painfully obvious that all BCOM wanted to do was dissect QCOM into a bunch of small companies. BCOM stopped innovating about 10 years ago once the GSM money train ran out. They now just acquire things. QCOM on the other hand actually is a tech company that makes things (you can argue how well). BCOM is nothing more than a shell of what it was. It is now just basically a tech holding company.
As to why Trump blocked it? It was a bad deal. Everyone knew it. The only ones coming out ahead were the bankers and hedge fund managers.