In Letter, CFIUS Suggests It May Soon Recommend Against Broadcom Bid for Qualcomm

By Kate O'Keeffe

A U.S. national-security panel suggested it soon could recommend against Broadcom Ltd.'s $117 billion hostile bid for Qualcomm Inc. and said that the Singapore-based company had repeatedly violated one of its orders during its pursuit of the proposed deal.

The Committee on Foreign Investment in the U.S., known as CFIUS, told lawyers for the companies in a Sunday letter that its investigation into Broadcom's bid is expected to "close soon" and that it "so far" confirms the national security risks it had previously identified with the proposed deal.

CFIUS, a multiagency panel that reviews foreign deals and can advise the president to block them on national security grounds, gave the companies a March 12 deadline to submit any further information "as the parties will likely not have an additional opportunity to submit information thereafter," according to the Sunday letter signed by an official at the Treasury, which chairs CFIUS.

In the absence of any information that changes CFIUS's assessment of the potential deal's national-security risks, the panel "would consider taking further action, including but not limited to referring the transaction to the president for a decision," the letter says.

The Treasury official says in the letter that CFIUS has accelerated its investigation "in light of the action Broadcom has taken in violation of the interim order," which had required the company to provide the panel with five business days' notice before taking any action toward redomiciling in the U.S.

Broadcom in a Monday statement said it believes it "is in full compliance" with CFIUS's order.

--Cara Lombardo contributed to this article

Write to Kate O'Keeffe at kathryn.okeeffe@wsj.com

(END) Dow Jones Newswires

March 12, 2018 12:06 ET (16:06 GMT)

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