Skip to main content

Qualcomm will pay $2 billion to end failed acquisition of NXP

By

Qualcomm has finally given up on buying NXP Semiconductors, a Dutch company known for automotive and IoT chips, which it’s been trying to acquire for nearly two years. The deal has long been held up by the Chinese government, and now, Qualcomm has said it will scrap the agreement altogether rather than continue the uncertain fight toward a completed acquisition. In doing so, it’ll have to pay a breakup fee of $2 billion.

The two companies initially entered into a deal in October 2016, with Qualcomm agreeing to pay $47 billion for NXP. The deadline to close the deal has been extended many times since then, as the companies wait for China to approve or deny the merger; every other country reviewing the acquisition granted its approval.

With no answer from China, the deal will once again hit its deadline tonight, but this time Qualcomm doesn’t plan to extend it. The agreement is still valid until midnight ET, so it’s possible the acquisition will still go through; but China would have to approve the transaction within the next six and a half hours for that to happen. “We intend to terminate our purchase agreement to acquire NXP when the agreement expires at the end of the day today, pending any new material developments,” Qualcomm CEO Steve Mollenkopf said in a statement announcing the company’s third quarter earnings today.

Though Qualcomm will have to pay a breakup fee for letting the acquisition fall through, it also frees up the cash it had set aside to pay for the NXP deal. It plans to put $30 billion toward a stock repurchase program.

The bigger downside for the company is that, without NXP, Qualcomm is even more reliant on its existing product portfolio at a time when it’s under a legal assault across the globe for allegedly anti-competitive patent licensing practices. The company maintains a commanding lead in the mobile processor and modem space, but the IoT and automotive markets — both of which Qualcomm competes in too — are still taking off, and the breakup of this deal means fewer ready-to-go resources for Qualcomm.



from The Verge - Teches https://ift.tt/2JTHtR3
Labels:

Comments

Post a Comment

Popular posts from this blog

Magic Leap is shipping across (most of) the US

By
As Magic Leap holds the first developer conference for its Magic Leap One mixed reality headset, that headset has started shipping across the contiguous United States, instead of in a set of select markets. The Magic Leap One Creator Edition costs $2,295, just like before, but there’s now an installment plan that starts at $96 per month. All orders are supposed to arrive within 60 days. The Magic Leap One Creator Edition went on sale in early August, and while Magic Leap has touted it as a fully functional device, it’s basically meant for people who want to design apps, games, or art for mixed reality. We were ambivalent toward the hardware, which we found limited, and we noted that Magic Leap hadn’t shown off a lot of material that showcased its potential. The company’s developer conference keynote has revealed several new projects. Among other things, Spider-Man studio Insomniac Games is building an experience that will let you grow a holographic creature on your tabletop, and...
Post a Comment
Read more

US carriers introduce Project Verify to replace individual app passwords

By
Four major US carriers — AT&T, Sprint, T-Mobile, and Verizon — are joining forces to launch a single sign-on service for smartphones. The service, called Project Verify , authenticates app logins so that users don’t need to memorize passwords for all their apps. The companies say their solution verifies users through their phone number, phone account type, SIM card details, IP address, and account tenure. Essentially, your phone serves as the verification method with details that are hard to spoof. Users have to manually grant apps permission to use Verify, and it works similarly to how you might log into some services through Gmail or Facebook instead of using a unique account password. Of course, these apps also have to choose to work with Verify, and the program hasn’t listed any partners or when it intends to launch. The service can serve as your two-factor authentication method, too, instead of an emailed or texted code that can be intercepted. Users might not be totally sa...
1 comment
Read more