Xi Open to Approving Qualcomm-NXP Deal if Presented Again

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The saga started back in October 2016 when Qualcomm made a successful $38 billion bid for the semiconductor maker.

Acquisitions of USA companies by Chinese companies, on the other hand, have been few and far between in the past year, after the Committee on Foreign Investment in the United States (CFIUS), a government panel that scrutinizes deals for potential national security risks, shot down more of these deals, such as Ant Financial's plan to acquire U.S. money transfer company MoneyGram International.

The Chinese president would be open to approving the acquisition of NXP should Qualcomm propose again, according to the White House.

Qualcomm told Reuters that although it welcomed the development, the deadline for the deal to be completed had passed and it had no interest in resurrecting the deal.

But in a media statement, Qualcomm said the deadline for the planned transaction has expired, and the company now "considers the matter closed", with no intention of reviving talks.

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In addition, Qualcomm has already moved ahead with a $30 billion stock buyback in the wake of the original acquisition failure, with $21 billion already spent, "making it significantly more hard to re-engage on a deal", said Rasgon.

The acquisition deal between Qualcomm and NXP, worth $ 44 billion, ceased earlier this year because China did not grant timely approval. Yesterday, China's president said the Chinese government would let the deal go through after all, but a Qualcomm official insists that the deal is is still dead. "If at the end of this period of time (90 days), the parties are unable to reach an agreement, the 10% tariffs will be raised to 25%", the statement said. Since Qualcomm has significant ties with Chinese OEMs, the chip maker had no choice but to agree with China's decision.

NXP has also announced its own US$5 billion share buyback programme. It has spent more than $20 billion (roughly Rs. 1.4 lakh crores) in share buybacks in the last 12 months. A successful acquisition of Mellanox could prove an important test of China's appetite to approve such deals.

Competition regulators in eight countries had approved the takeover.

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