Qualcomm to Pay $2 Billion Breakup Fee to NXP, After Deal Fails to Get China Approval

Qualcomm to Pay $2 Billion Breakup Fee to NXP, After Deal Fails to Get China Approval

Qualcomm said Wednesday it was dropping its $44 billion (roughly Rs. 3 lakh crores) deal to buy Dutch chipmaker NXP Semiconductors, a high-profile victim of the rising trade tensions between the US and China.

Instead, the San Diego-based chipmaker said it will pay a $2 billion  (roughly Rs. 13,700 crores) breakup fee to NXP and spend up to $30 billion (roughly Rs. 2.06 lakh crores) buying back its own stock.

Qualcomm had once hailed the NXP deal, first announced in 2016, as a way to break into markets for automobiles, security and network processing. But it said it would let the agreement expire at midnight Wednesday unless China granted last-minute approval.

"Continued uncertainty overhanging such a large acquisition introduces heightened risk," Qualcomm CEO Steven Mollenkopf said in a conference call with industry analysts. "We weighed that risk against the likelihood of a change in the current geopolitical environment, which we didn't believe was a high probability outcome in the near future."

China was the last of nine markets needed to grant regulatory approval for Qualcomm's acquisition of NXP. But anti-monopoly authorities there had delayed approval, which led to speculation the deal was being used as leverage in the trade spat with Washington.

Qualcomm's announcement came in its report of its quarterly earnings, which beat analyst forecasts.

Its shares rose 6 percent in after-hours trading.


For the latest tech news and reviews, follow Gadgets 360 on X, Facebook, WhatsApp, Threads and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel. If you want to know everything about top influencers, follow our in-house Who'sThat360 on Instagram and YouTube.

Further reading: Qualcomm, NXP Semiconductors
Amazon Expands Alexa's Brain With Yext Business Services
Facebook Rolls Out Watch Party Feature, Letting People Watch Videos Together
Share on Facebook Gadgets360 Twitter Share Tweet Snapchat Share Reddit Comment google-newsGoogle News


Follow Us


© Copyright Red Pixels Ventures Limited 2024. All rights reserved.
Trending Products »
Latest Tech News »