Acquisition of Qualcomm Remains Conditioned on Redomiciliation U.S. National Security a Broadcom Priority
OREANDA-NEWS. March 19, 2018. Broadcom Limited (NASDAQ: AVGO) ("Broadcom") today issued the following statement:
Broadcom is in the final stages of redomiciling to the U.S. and now expects to complete redomiciliation by April 3, 2018. Broadcom's proposal to acquire Qualcomm has always been premised on the completion of Broadcom's previously announced plan to redomicile. In both the definitive merger agreement that Broadcom provided to Qualcomm and in the revised version that Qualcomm sent back to Broadcom on February 26, 2018, one of the closing conditions was that Broadcom redomicile to the U.S., and notably, in neither party's draft was the closing of the proposed acquisition conditioned on CFIUS clearance. In short, U.S. national security concerns are not a risk to closing, as Broadcom never plans to acquire Qualcomm before it completes redomiciliation.
Broadcom recognizes the essential role the member agencies of CFIUS play in ensuring U.S. national security. Broadcom, which is in all important respects a U.S. company, has been repeatedly approved by CFIUS in its previous acquisitions of U.S. companies and has always engaged productively with CFIUS to ensure U.S. national security is protected. Broadcom believes the CFIUS process is an essential aspect of protecting U.S. national security and it is supportive of current efforts, including those of Senator Cornyn, Representative Pittenger, and many of their colleagues, to enhance the CFIUS process. In addition, as a company incorporated in the U.S., Broadcom looks forward to working directly with the U.S. government as a trusted supplier, and continuing Qualcomm's existing engagements.
Broadcom's plan to redomicile is and has been a matter of public record since last November and has been addressed multiple times in recent months. This plan was first announced in the White House when Hock Tan, Broadcom's President and Chief Executive Officer, had the honor to announce the plan alongside President Trump in the Oval Office on November 2, 2017. Furthermore, CFIUS reviewed and cleared Broadcom's acquisition of Brocade, which closed on November 17, 2017. As part of the clearance agreement, Broadcom agreed with CFIUS to redomicile to the U.S. The details are included as part of Broadcom's 10-K "Risk Factors" and are also outlined in the Proxy Statement for Broadcom's Special Stockholder Meeting. Given Broadcom's public disclosures about the redomiciliation process since last November, as well as its direct communications to CFIUS, Broadcom has been fully transparent with CFIUS about the redomiciliation process, and believes it is in full compliance with the March 4 Interim Order.
Broadcom Limited is a leading designer, developer and global supplier of a broad range of digital and analog semiconductor connectivity solutions. Broadcom Limited's extensive product portfolio serves four primary end markets: wired infrastructure, wireless communications, enterprise storage and industrial & other. Applications for our products in these end markets include enterprise and data center networking, home connectivity, set-top boxes, broadband access, telecommunication equipment, smartphones and base stations, data center servers and storage systems, factory automation, power generation and alternative energy systems, and electronic displays.