President Trump halts Penang-born Tan's Broadcom takeover of Qualcomm

Broadcom, led by ambitious Chief Executive Officer Hock Tan, is seeking to build a behemoth chip company to get major market share.

WASHINGTON: US President Donald Trump issued an order on Monday prohibiting semiconductor maker Broadcom Ltd's proposed takeover of Qualcomm Inc on grounds of national security, bringing an end to what would have been the technology industry's biggest deal ever.

Qualcomm had rebuffed Broadcom's $117 billion takeover bid, which was under investigation by the U.S. Committee on Foreign Investment in the United States (CFIUS), a multi-agency panel led by the U.S. Treasury Department that reviews the national security implications of acquisitions of U.S. corporations by foreign companies.

"The proposed takeover of Qualcomm by the Purchaser (Broadcom) is prohibited, and any substantially equivalent merger, acquisition, or takeover, whether effected directly or indirectly, is also prohibited," the presidential order released on Monday said.

(Note: Tan Hock Eng, who is from Penang, is behind Broadcom. He is the president and CEO. The MBA degree holder from Harvard University, worked with Tan Sri Quek Leng Chan as managing director of Hume Industries in Malaysia from 1983 to 1988 before helming a venture capital fund in Singapore from 1988 to 1992.) 

The order issued by the White House cited "credible evidence" that led Trump to believe that Broadcom taking control of Qualcomm "might take action that threatens to impair the national security of the United States."

This is the fifth time ever a U.S. President has blocked a deal based on CFIUS objections and the second deal Trump has stopped since assuming office.