The deadline for Qualcomm’s proposed merger of Dutch NFC innovator NXP Semiconductors will run out in a matter of hours but there’s still no word from China on the matter as Beijing’s antitrust watchdog has yet to approve the deal after spending the better part of the last two years reviewing it, at least officially. Insiders cited by Reuters believe the Far Eastern country remains adamant to continue stalling as its trade war with the United States is still escalating and would possibly be prepared to block the deal from materializing completely, with that move being likely to raise the already high tensions between the world’s two largest economies.
Qualcomm’s inability to close the $44 billion NXP purchase in a timely manner exposed it to the threat of being acquired by Broadcom earlier this year as a significant number of its investors were prepared to sell the company, though the Trump administration ended up preventing the hostile takeover, citing national security concerns. Any scenario wherein Beijing fails to approve Qualcomm’s proposed acquisitions would likely be interpreted by the West as the de facto proof that China’s competition watchdogs aren’t interested in maintaining fair trade as much as they’re focused on serving the state regime, one insider claims.
Qualcomm’s move to acquire the Dutch firm in late 2016 in a bid to diversify its operations and make its revenue stream less reliant on smartphone technologies, an area in which its performance is likely to start declining moving forward amid a wave of antitrust concerns regarding its patent licensing practices. With NXP under its corporate umbrella, the San Diego-based chipmaker would instantly gain a much larger foothold in the IoT and connected vehicle segment, some of its largest potential growth avenues in the long term. One insider close to Qualcomm recently claimed the company hasn’t made any progress on the investigation led by China’s State Administration for Market Regulation despite being cooperative, having likened the state agency’s probe to a “stone wall.”