Members of Congress have called for a federal review of Broadcom Ltd.’s proposed acquisition of Qualcomm Inc. and Reuters reports that such a review has already begun. The Reuters account, from Feb. 26, cited unnamed sources.
Rep. Duncan D. Hunter (R-El Cajon) released a Feb. 22 letter to President Trump, calling for a federal probe into the national security implications of a Qualcomm-Broadcom deal, and a halt to the sale until such a probe is finished. Reuters reported that Sen. John Cornyn (R-Texas) asked Treasury Secretary Steve Mnuchin to review the transaction.
“By acquiring Qualcomm, Broadcom would become the world’s third largest chipmaker, controlling a large portion of the supply chain, which is critical to the vital communication components such as Wi-Fi and cellular modem chips,” Hunter’s letter said. “Such a company could, if motivated by a nation or groups not friendly to the United States, compromise critical communications and install lock out features that would prevent U.S. security teams from monitoring mobile data.”
Hunter’s letter also says “thousands of Americans who comprise the Qualcomm creative team could lose their jobs or be moved off-shore, which would be a major loss for our nation.”
A similar federal review scuttled the plans of a San Diego firm last year.
Inseego, the corporation formerly known as Novatel Wireless, attempted to sell its Mifi wireless hotspot business to a Hong Kong corporation in the spring of 2017. However, it never received clearance from CFIUS, the Committee on Foreign Investment in the United States, and the parties were forced to withdraw from the sale.
In a June interview, former Inseego CEO Sue Swenson recalled about 20 rounds of questions from federal authorities. They discussed technical topics as well as the acquiring company’s connections to its government.