President Donald Trump has blocked a bid to acquire the mobile chip manufacturer Qualcomm by its Singaporean rival Broadcom.
In a statement released by the White House, President Trump cited security concerns as a key reason for Broadcom's $117 billion offer for the San Diego-based Qualcomm being blocked.
"There is credible evidence that leads me to believe that Broadcom Limited... through exercising control of Qualcomm Incorporated...might take action that threatens to impair the national security of the United States," the statement read.
President Trump has advised that the deal - "and any substantially equivalent merger, acquisition, or takeover" - be prohibited, and that Broadcom's 15 candidates for election to the Qualcomm board also be prevented from joining. Both Broadcom and Qualcomm must "certify in writing" that the takeover bid has been abandoned once all the steps outlined in Trump's statement have been taken.
According to The New York Times, Qualcomm had been against the Broadcom bid, but it was due to be voted on by the company's shareholders - with a hostile takeover a distinct possibility. Broadcom issued a statement indicating its strong disagreement that the, proposed acquisition of Qualcomm raises any national security concerns."
This move is another example of protectionist thinking within the Trump administration, which Rob Fahey recently argued poses a greater threat to the games industry than the ongoing debate on gun violence.
While Qualcomm has a broad range of business interests, its Snapdragon chips have powered the smartphones that helped mobile to become the single most valuable part of the games market.