US chipmaker Qualcomm Inc. has ruled out any possibility of a renewed bid for rival NXP Semiconductors after President Xi reopened the doors for a new bid during his meeting with President Trump over the weekend. The company, however, dismissed the idea.
"While we were grateful to learn of President Trump and President Xi's comments about Qualcomm's previously proposed acquisition of NXP, the deadline for that transaction has expired, which terminated the contemplated deal", a Qualcomm spokesperson is quoted as saying. The $44 billion reportedly received approval from the antitrust authorities in America, Japan and Europe but fell through when China refused to approve of it by the 25 July 2018 deadline.
"Qualcomm considers the matter closed", a Qualcomm spokesman said. Afterward, Trump said Xi would consider giving a green light to a Qualcomm/NXP merger should the deal be presented to him again.
Qualcomm paid NXP a US$2 billion fee to terminate the deal and embarked on a US$30 billion stock repurchase plan to appease shareholders miffed by the deal falling through. Qualcomm was given just an hour's notice by the Trump administration about Xi's comment on the NXP deal, and its inclusion in the White House statement, according to two of the sources. Qualcomm spent United States dollars 22.6 billion on share buybacks in the 12-months ended September, using up the cash reserves it had set aside for the acquisition and ending any possibility of a renewed bid.More news: Late President George H.W. Bush lies in state in Washington
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After the meeting, Trump said they had reached an "incredible deal". NXP has also announced its own $5 billion (around Rs. 35,200 crores) share buyback program.
The offer was part of an agreement struck by Xi and U.S. President Donald Trump over dinner on Saturday in Buenos Aires, where the pair negotiated a temporary cease-fire in the tit-for-tat trade war between the world's two largest economies.
Competition regulators in eight countries had approved the takeover.