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Qualcomm And China Regulators To Meet To End Deadlock Over The $44 Billion NXP Deal: Reports


05/28/2018


Qualcomm And China Regulators To Meet To End Deadlock Over The $44 Billion NXP Deal: Reports
Media reports suggest that executives form Qualcomm Inc are set to meet Chinese anti-trust regulators this week in Beijing in its effort to convince them to clear the proposed $44 billion acquisition of NXP Semiconductors NV.
 
The proposed takeover has been stalled temporarily in the trade tensions between the United States and China and many believe that the fate of the deal would depend on how the trade talks between the two countries move ahead. The deal has been cleared by eight of the nine anti-trust regulators throughout the world as was necessary for the deal except China.
 
The meeting between Qualcomm executives and Chinese regulatory authorities is likely to be held before the visit of U.S. Commerce Secretary Wilbur Ross to China on Saturday.
 
Sources reportedly said that initial “productive” talks were held between a team from Qualcomm and the officials from the State Administration for Market Regulation (SAMR) in Beijing on Friday.
 
Sources further said that following those initial talks, Qualcomm is now “cautiously optimistic” about the clearance of the deal and has been helped by a recent toning down of the trade tensions between the U.S. and China.
 
The trade relations were further helped after the decision of the Trump administration’s announcement to allow ZTE Corp to get back in business in the U.S. following the Chinese company paying up $1.3 billion in fine and after it makes some changes in its management.
 
For Chinese leadership, it was very important to resolve the ZTE sales ban in the U.S. the company had bene banned from making purchases of technology components from U.S. companies in April this year for a period of 7 years following the Chinese firm’s alleged breach of an agreement that had been reached for the violation of U.S. sanctions on Iran and North Korea.
 
There was no official comment made by Qualcomm on the news.
 
Final guarantees and assurances are expected to be provided by Qualcomm through a new submission that it is preparing to offer to SAMR.
 
According to sources quoted in the media, there are “perceived linkages” and the current discussion to be held is “not coincidental”, despite the discussion having no direct linkages to ZTE’s issues, the Sino-U.S. trade tensions and the Qualcomm-NXP deal clearance.
 
“The degree to which the two sides are moving to resolve trade tensions clearly has an impact,” sources said.
 
The discussions on the clearance of the deal had bene stalled at the end of last year and Qualcomm had initiated the discussions only in recent weeks.
 
Following the discussions yielding no results, its China anti-trust application was forced to be refiled by Qualcomm in April to clear the NXP deal.
 
(Source:www.reuters.com)


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